Crude oil is sliding

Crude oil is sliding again.

On Wednesday afternoon in New York, West Texas Intermediate crude futures fell nearly 2% to as low as $US44.91 a barrel.

Earlier today, the Energy Information Administration released its weekly data on oil inventories, which showed that commercial crude inventories fell by 4.4 million barrels to 455.3 million. An epic buildup in inventories from January through May added to evidence of the supply glut from the shale boom.

Last week’s drop was the second in two weeks. But the market has shrugged this, and WTI has touched levels not reached since March and is cents away from the year-to-date low of around $US44 a barrel.

Concerns about oversupply in the market have sent oil prices lower in recent weeks. Coupled with weakening demand from China, crude oil has declined with other commodities in a magnitude not seen since 2008.

Here’s a chart showing the drop on Wednesday:

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