CORRECTED-UPDATE 8-Oil slumps 4% on U.S. crude build, slowing demand fears

Reuters

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 (Corrects closing WTI price in 3rd paragraph to $51.14, not
$50.72)
    * U.S. crude stockpiles rise unexpectedly for second week
-EIA 
    * Trump has a 'feeling' that U.S., China can strike trade
deal
    * EIA cuts 2019 global oil growth forecast by 160,000 bpd
    * Algeria floats idea of larger OPEC+ cut - sources

    By Laila Kearney
    NEW YORK, June 12 (Reuters) - Oil prices tumbled 4% on
Wednesday to their lowest settlements in nearly five months,
weakened by another unexpected rise in U.S. crude stockpiles and
by a dimming outlook for global oil demand.
    Brent crude futures  LCOc1  fell $2.32, or 3.7%, to settle
at $59.97 a barrel, the international benchmark's lowest close
since Jan. 28.
    U.S. West Texas Intermediate crude futures  CLc1  ended
$2.13, or 4.0%, lower at $51.14 a barrel, its lowest settlement 
since Jan. 14.
    The U.S. Energy Information Administration (EIA) reported
domestic crude stockpiles  USOILC=ECI  rose unexpectedly for the
second week in a row, climbing 2.2 million barrels last week
after analysts had forecast a decrease of 481,000 barrels.
 urn:newsml:reuters.com:*:nL2N23J0MI
    At 485.5 million barrels, U.S. commercial stocks were at
their highest since July 2017 and about 8% above the five-year
average for this time of year, the EIA said.
    "Its definitely a market that is still in some disbelief of
these inventory builds, and they're not going to be able to look
beyond it," said Phil Flynn, analyst at Price Futures Group in
Chicago. "It has been more difficult to guess what the EIA is
going to add every week."
    The EIA on Tuesday cut its forecasts for 2019 world oil
demand growth, which also pressured oil futures.  urn:newsml:reuters.com:*:nL2N23I0Y2
 urn:newsml:reuters.com:*:nAQN00RTP2
    Trade tensions between the United States and China, the
world's two biggest oil consumers, also weighed on prices.
    U.S. President Donald Trump on Wednesday said he had a
feeling that a trade deal could be reached, while again
threatening to increase tariffs on Chinese goods if they do not
make a deal.  urn:newsml:reuters.com:*:nL2N23J0XO
    Hedge fund managers are liquidating bullish oil positions at
the fastest rate since the fourth quarter of 2018 due to
increasing fears about the health of the global economy.
 urn:newsml:reuters.com:*:nL8N23I4HH
    Goldman Sachs said an uncertain macroeconomic outlook and
volatile oil production from Iran and others could lead OPEC to
roll over supply cuts.  urn:newsml:reuters.com:*:nFWN23J02Z   
    With the next meeting of the Organization of the Petroleum
Exporting Countries set for the end of June, the market is
looking to whether the world's major oil producers will prolong
their supply cuts. 
    OPEC countries and non-member producers including Russia,
have limited their oil output by 1.2 million barrels per day
this year to prop up prices. 
    The energy minister of the United Arab Emirates, Suhail bin
Mohammed al-Mazroui, said on Tuesday that OPEC members were
close to reaching an agreement on continuing production cuts.
 urn:newsml:reuters.com:*:nL2N23I1U8
    Algeria has floated an idea of increasing an oil supply cut
by OPEC and its allies in the second half of 2019 as demand
falters, OPEC sources said, although rolling over current output
curbs is still the most likely scenario.  urn:newsml:reuters.com:*:nL8N23J3ZW

 (Additional reporting by Julie Payne in London and Scott
DiSavino in New York; Editing by David Gregorio and Marguerita
Choy)
 ((laila.kearney@thomsonreuters.com, (917) 809-0054))

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