Oil prices decline as US crude stockpiles surge

Oil prices settled lower on Wednesday after report showed an unexpected build in the US crude stockpiles.

The US crude inventories increased by 4.7 million barrels in the week ending 17 May, the US Energy Information Administration reported.

At 476.8 million barrels, the US crude oil inventories are about four per cent above the five year average for this time of year, the Xinhua news agency reported.

Investors were worried that increasing US stockpiles combined with prolonged tensions between the US and its major trading partners would dampen market sentiment.

The West Texas Intermediate for July delivery declined 1.71 US dollars to settle at 61.42 dollars a barrel on the New York Mercantile Exchange, while Brent crude for July delivery decreased 1.19 dollars to close at 70.99 dollars a barrel on the London ICE Futures Exchange.