Crude oil futures drop further, hit 2-year lows

Investing.com - U.S. oil futures dropped to the lowest level since July 2012 on Friday, as rising supply and concerns over global economic growth weighed heavily on demand for the commodity.

On the New York Mercantile Exchange, crude oil for delivery in November traded at $84.70 a barrel during European early afternoon trade, down 1.07$ or 1.25%.

Prices lost 1.54$ or 1.76% on Thursday to settle at $85.77.

Futures were likely to find support at $82.10 a barrel and resistance at $87.95, Thursday's high.

Oil prices remained under pressure after the U.S. Energy Information Administration said in its weekly report on Wednesday that U.S. crude oil inventories increased by 5 million barrels in the week ending October 3, blowing past expectations for a gain of 1.6 million barrels.

The report also showed that gasoline stockpiles rose by 1.2 million barrels, confounding expectations for a drop of 1.0 million barrels.

The data came a day after the American Petroleum Institute said that U.S. crude inventories increased by 5.1 million barrels in the week ending October 3, more than expectations for a rise of 1.4 million barrels.

Meanwhile, worries over the health of the global economy persisted after the International Monetary Fund cut its global economic growth forecasts for the third time this year on Tuesday and warned that the recovery remains weak and uneven.

Sentiment was also hit by concerns over a recession in Germany after two local officials reportedly said that Europe's largest economy would cut its growth forecasts for 2014 and 2015 next week.

The news followed data earlier this week that showed exports in Europe's largest economy fell in August by the most since January 2009.

Elsewhere, on the ICE Futures Exchange in London, Brent Oil for November delivery dropped 0.67$, or 0.74%, to hit $89.39 a barrel.

The spread between the Brent and the WTI crude contracts stood at $4.69.