Oil slips below $39 after US crude stockpiles expand to record

Oil declined in New York as an increase in American crude stockpiles to a record high raised fresh concerns about excess supply, while the Federal Reserve forecast a long road to recovery for the US economy.

Futures lost 3.2% to drop below $39 a barrel, erasing all of the gains from the previous session. US crude inventories unexpectedly rose last week, even as oil production fell, while gasoline stockpiles also saw a surprise expansion. Fed Chairman Jerome Powell said the pandemic could inflict longer-lasting damage on the economy and the central bank signaled it would keep rates near zero possibly for years to come.