(MENAFN- The Peninsula) Another huge rise in US stockpiles and record oil output in Saudi Arabia sent crude prices tumbling Wednesday.
US benchmark West Texas Intermediate (WTI) for delivery in May sank $3.56 to $50.42 a barrel in New York trading.
In London, Brent North Sea crude for May dropped $3.55 cents to $55.55 a barrel.
Already off in opening trade, WTI took a sharp downturn when the Department of Energy's weekly commercial inventories report showed an increase of nearly 11 million barrels of crude to a fresh record high of 482.4 million barrels.
Analyst Matt Smith of Schneider Electric called the increase, triple what was expected, "a sucker punch for the markets" after two days of solid gains in crude prices.
Also hitting prices was the announcement by Saudi Oil Minister Ali al-Naimi that Saudi production hit an all-time high of 10.3 million barrels a day in March, despite the global crude glut and sagging prices.
That was up 450,000 barrels per day from February and topped the previous peak in 1980, and Naimi said he expected the kingdom's production to continue at around 10 million barrels a day.
Rather than tailing back production in the face of a 50 percent fall in crude prices since June, Riyadh is aggressively defending its hold on clients, and analysts say it wants to drive more expensive producers from the market altogether.
The increased production "indicates that they continue to fight for their market share," said Smith.
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