WTI falls despite lower U.S. inventories

WTI, the U.S. benchmark price, shed close to $1 per barrel for the January contract in early Thursday trading to fetch $66.40. That's down more than 30 percent from the June value and below the point where oil production from U.S. shale deposits is considered profitable.

The drop came despite a report from the U.S. Energy Information Administration that said crude oil inventories were lower and production in the Lower 48 was static during the week ending Nov. 28.

Oil prices in general have dropped sharply since last week's decision by the Organization of Petroleum Exporting Countries to keep its production levels static. The move was seen by some as a sign OPEC was trying to keep prices lower to force rival shale players out of the game.

Lower production could put positive pressure on prices as less product is available on the market. EIA said crude oil production for the week ending Nov. 28 was unchanged at 8.5 million barrels day in the Lower 48, where shale reserves dominate.

A modest increase overall came as a result of more oil coming from Alaska. U.S. commercial crude oil investors declined by 3.7 million barrels from the previous week, EIA said in its weekly petroleum status report.

WTI prices for the week ending Nov. 28 were more than $10 below the previous week and off $26.61 from the same time last year.

Brent crude oil prices moved more or less in parity with WTI, losing about 60 cents per barrel to trade just below $70 for January delivery.