LONDON, May 4: World oil prices extended heavy losses on Thursday, resulting in $5 drop for light sweet crude in just two days after a surprise rise in stocks of US motor fuel, traders said.

Despite the sharp price declines, the market remains concerned that the nuclear crisis in Iran, the world’s fourth-biggest producer of crude, could disrupt crude supplies from the country.

New York’s main contract, light sweet crude for delivery in June, sank $2.88 to $69.40 per barrel in pit trading. It was the first fall below $70 since April 13 and followed a loss of $2.33 on Wednesday.

On Thursday in electronic deals, the price of London’s Brent North Sea crude for June delivery shed $2.49 to $70.16 per barrel, after slipping $1.99 the previous day.

Prices began tumbling after a buoyant weekly stocks report from the US Department of Energy (DoE) on Wednesday, which eased concerns about shortages of gasoline in the US.

An investment strategist with CFC Seymour Securities in Hong Kong, Dariusz Kowalczyk, said: “Basically this is due to the impact of the US inventory report which weighed on the price of commodities, including oil.”

Reserves of crude oil in the United States, the world’s biggest economy, rose by 1.7 million barrels to 346.7 million barrels in the week to April 28. Analysts had expected a fall of 150,000 barrels.

The DoE added that gasoline or petrol reserves, which are in focus before the US summer driving season, rose by 2.1 million barrels to 202.7 million.

The figure compared with market forecasts of a 650,000-barrel drop.—AFP