11/05/2013 03:30 EST | Updated 01/23/2014 06:58 EST

Crude oil continues month-long decline on higher supplies; falls below US$94

The price of oil dropped another one per cent Tuesday to below US$94 a barrel, extending a month-long slide due to expectations of rising supplies.

Benchmark West Texas Intermediate crude for December delivery fell $1.25, or 1.3 per cent, to close at US$93.37 a barrel on the New York Mercantile Exchange. Brent crude, which is used to price international oil used by many U.S. refiners, fell 90 cents to close at US$105.33.

U.S. crude stockpiles have increased in each of the past six weeks, mostly because of rising domestic production and were more than 10 per cent above their five-year average near the end of October.

Figures for the week ended Nov. 1 are expected to show a further increase of 2.5 million barrels, according to a survey of analysts by Platts, the energy information arm of McGraw-Hill Cos.

The weekly supply report from the U.S. Energy Department's Energy Information Administration will be out on Wednesday.

Crude is down 10 per cent since closing at $104.10 on October 2. It had climbed above $110 in early September amid instability in Egypt and the civil war in Syria.

It began to sink later in September and then its decline accelerated in October as Iran re-entered international talks over its nuclear program and rising U.S. crude stockpiles indicated muted demand.

Analysts say oil might have fallen further still if not for continued instability in Egypt and new fighting in Libya that is impacting Libyan crude exports. "The ongoing delivery outages in Libya are preventing prices from falling," said analysts at Commerzbank in Frankfurt.

But the expectation is that oil has yet further to fall. Oil analyst Jim Ritterbusch wrote in a report at the end of trading Tuesday that "both crude benchmarks still appear poised for additional price weakness."

In other energy futures trading on Nymex, wholesale gasoline was down 1.2 cents to close at US$2.516 a U.S. gallon (3.79 litres), heating oil was down one cent to close at US$2.864 a gallon and natural gas rose 2.1 cents to US$3.466 per 1,000 cubic feet.