Oil slides following US inventory update

Oil futures erased their earlier session gains on Thursday, with losses accelerating after the U.S. Energy Information Administration released its weekly inventory update.

U.S. weekly crude oil stocks increased by 1.2 million barrels, versus forecasts for a 3.5 million barrel draw.

Before the reversal, U.S. crude oil  futures were hovering at their highest price in about 3-1/2 years with supply disruptions continuing to support the market.

Also, President Trump once again took to Twitter to call out the Organization of Petroleum Exporting Countries (OPEC) for the high oil prices.

The oil market has been supported by a fall in output from Venezuela and the potential for a halt of Iranian oil exports due to U.S. sanctions. OPEC reached an agreement in June to increase output, but this did little to stop the rise in oil prices.

A supply outage in Libya is adding extra upside support.