Oil price plunges

Oil prices fell on Wednesday after an industry group reported a surprise rise in U.S. crude, adding to worries about demand that led to a steep selloff earlier in the week.

Brent crude was trading down 30 cents, or 0.7%, at $41.42 a barrel by 0347 GMT, after gaining 28 cents on Tuesday, while U.S. crude dropped 34 cents, or 0.9%, to $39.46.

Both contracts fell more than 4% on Monday, the most in two weeks.

Gasoline stocks fell by nearly 7.7 million barrels, nearly 8 times expectations suggesting some demand for fuel in the world’s biggest oil consuming nation.

Official data from the Energy Information Administration is due out later on Wednesday.

“Official U.S. crude inventory data assumes greater than usual importance,” said Jeffrey Halley, senior market analyst at OANDA. “A surprise increase could well be enough to initiate another downward leg in crude prices.”

In Libya, the National Oil Company expects oil output to rise to more than a quarter of a million barrels per day by next week, it said on Tuesday.