Oil extends losses on weak global economic outlook

US crude oil stocks rose 4.7 million barrels to 455.4 million barrels last week, the EIA said

Oil prices fell a second day on Wednesday after government data showing US crude stockpiles rose last week added to concerns about global oversupply and sluggish economic growth in China.

After a frenzied short-covering fueled a 25 per cent three-session surge that ended on Monday, the two sessions of losses have extended the turbulent run that saw oil slide to six and a half-year lows last week.

US crude oil stocks rose 4.7 million barrels to 455.4 million barrels last week, the Energy Information Administration (EIA) said.

"While there is some seasonality to crude beginning to build at this time of the year, a four-plus-million-barrel build is bearish and larger than normal," said Scott Shelton, commodities specialist with ICAP in Durham, North Carolina.

Analysts in a Reuters poll had expected US crude stocks to have remained flat last week and the EIA report followed Tuesday's report from American Petroleum Institute (API) showing crude stocks rose 7.6 million barrels to 456.9 million.

Brent October crude was down $1.60 at $47.96 a barrel at 12:19 p.m. EDT (1619 GMT), having swung from $47.74 to $50.79. US October crude was down $1.95 at $43.46, having traded as low as $43.21 after reaching $46.32.

Crude futures extended losses on news that Shell's Nigerian unit has lifted force majeure on Bonny Light exports following the repair and re-opening of the Trans Niger Pipeline and Nembe Creek Trunkline.

Also adding pressure was news that President Barack Obama has the backing of enough Senate votes to sustain a veto of any congressional resolution blocking Iran's agreement on its nuclear program with world powers.

Implementing the agreement will allow a sharp increase Iran's oil exports now curbed by sanctions.