Oil falls as traders note jump in US crude stockpiles
Oil prices fell on Wednesday as traders eyed a potential jump in U.S. crude inventories, while OPEC lowered its oil supply growth forecast for producers outside OPEC+.
Brent crude futures fell 23 cents, or 0.35%, to $66.40 a barrel by 10:15 a.m. ET. U.S. West Texas Intermediate (WTI) crude slipped 19 cents, or 0.3%, to $63.48.
OPEC on Wednesday trimmed its forecast for growth in oil supply from the United States and other producers outside the wider OPEC+ group this year. Supply from countries outside OPEC+ will rise by about 800,000 barrels per day in 2025, down from last month's forecast of 900,000 bpd, the Organization of the Petroleum Exporting Countries said on Wednesday.
"Definitely, the crude build in the API numbers was not of help. That said, the API report also contained supportive elements such as large refined product draws," said UBS analyst Giovanni Staunovo.
Crude stocks were up by 4.3 million barrels in the week ended May 9, market sources said, citing American Petroleum Institute figures, while gasoline inventories fell by 1.4 million barrels and distillate stocks dropped by 3.7 million barrels.
The fall in gasoline inventories comes as countries get ready to enter the Northern Hemisphere summer driving season.
Roth Capital Markets analysts in a note late on Tuesday said that the draw in products shown in API data was positive for the oil complex in the longer term as it shows that the oil market was under-supplied.
Official weekly inventory data from the U.S. Energy Information Administration is due on Wednesday at 10:30 a.m. EDT.
U.S. crude oil and gasoline stocks likely fell last week, distillate inventories likely rose and gasoline stocks potentially decreased, an extended Reuters poll found ahead of the data.
Broadly, both crude benchmarks were trading close to two-week highs touched in the previous session.
"Oil had a good rally in recent days...so we are probably seeing some profit taking," Staunovo added.
However, upside in prices was limited as concerns about demand remained.
Chicago Fed president Austan Goolsbee said on Wednesday that data showing temperate consumer inflation in April does not necessarily reflect the impact of rising U.S. import tariffs, and more data was needed to understand the direction of prices and the economy.
Hashtags
Try Our AI Features
Explore what Daily8 AI can do for you:
Comments
No comments yet...
Related Articles
Yahoo
2 hours ago
- Yahoo
Oil Prices Jump to 2-Month High on Middle East Concerns, Trade Optimism
Oil prices rose as a U.S.-China trade deal and soft inflation report boosted demand expectations while concerns about political instability in the Middle East sparked fears of supply disruptions. West Texas Intermediate futures contracts, the U.S. crude oil benchmark, rose as much as 5.2% on Wednesday to trade above $68 a barrel for the first time since April 2, when President Trump's "Liberation Day' tariff announcement pulled prices lower. Prices surged in afternoon trading amid reports that the State Department had ordered the departure of all nonessential personnel at the U.S. Embassy in Baghdad to address security concerns amid mounting tensions in the Middle East. Oil prices had risen earlier in the session after the U.S. and China agreed to a trade deal that eased fears about the economic fallout of a protracted trade war between the world's two largest economies. A soft inflation report added to Wall Street's optimism about demand. The energy sector led stock market gainers on Wednesday. Oil companies were up, with Occidental Petroleum (OXY) gaining 2% and ConocoPhillips (COP) both finishing up more than 2%. Read Investopedia's full coverage of today's trading here. Crude oil prices slumped to about $57 per barrel in early May, their lowest level since early 2021, after the Organization of Petroleum Exporting Countries and its allies agreed to boost production in June. Energy markets were on edge even before OPEC announced the supply increase: U.S.-China trade had effectively come to a standstill after the countries increased tariff rates on each other's goods to more than 100%, threatening to slow global growth and weigh on oil demand. Prices began to rebound in mid-May after the U.S. and U.K. agreed to a trade deal framework, giving Wall Street confidence that tariff rates would eventually settle below the levels announced in April. Oil's rebound picked up pace in early June when OPEC lifted its production targets by less than investors expected. Read the original article on Investopedia Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
Bloomberg
2 hours ago
- Bloomberg
Oil's Lost Decade Is About to Be Repeated
For as long as most of us can remember, a rule of thumb has held true: Every year, the world's production of oil goes up by one million barrels a day. In 1983, the figure stood at 56.6 million barrels. In 2023, 40 years later, it was 40 million barrels more: 96.3 million. Annual figures may jump around thanks to wars, recessions, and the rise and fall of economies, but averaged over the longer term, every decade we've added an extra 10 million daily barrels to the headline total.
CNBC
3 hours ago
- CNBC
U.S. preparing to partially evacuate Iraq embassy over regional security risks: Reuters sources
The United States is preparing a partial evacuation of its Iraqi embassy and will allow military dependents to leave locations around the Middle East due to heightened security risks in the region, U.S. and Iraqi sources said on Wednesday. The four U.S. and two Iraqi sources did not specify which security risks had prompted the decision and reports of the potential evacuation pushed up oil prices by more than 4%. "The State Department regularly reviews American personnel abroad and this decision was made as a result of a recent review," White House spokeswoman Anna Kelly told Reuters when asked about reports of the partial evacuations, without giving further details. A White House official said U.S. President Donald Trump was aware of the move. The partial evacuations come at a moment of heightened tensions in a region already aflame after 18 months of war in Gaza that has raised fears of a wider conflagration pitting the U.S. and Israel against Iran and its allies. Trump has repeatedly threatened to strike Iran if stuttering talks over its nuclear program fail and on Wednesday he said he was growing less confident that Tehran would agree to stop enriching uranium, a key American demand. Iranian Defense Minister Aziz Nasirzadeh also said on Wednesday that Iran would retaliate against U.S. bases in the region if the nuclear talks failed and it was subjected to strikes. The United States has a military presence in Iraq, Kuwait, Qatar, Bahrain and the United Arab Emirates. U.S. Defense Secretary Pete Hegseth has authorized the voluntary departure of military dependents from locations across the Middle East, a U.S. official said. Another U.S. official said that was mostly relevant to family members located in Bahrain -- where the bulk of them are based. "The State Department is set to have an ordered departure for (the) U.S. embassy in Baghdad. The intent is to do it through commercial means, but the U.S. military is standing by if help is requested," a third U.S. official said. An Iraqi foreign ministry official said a "partial evacuation" of U.S. embassy staff had been confirmed due to what the official termed "potential security concerns related to possible regional tensions." Another U.S. official said that there was no change in operations at Al Udeid Air Base in Qatar, the largest U.S. military base in the Middle East and that no evacuation order had been issued for employees or families linked to the U.S. embassy in Qatar, which was operating as usual. Oil futures climbed $3 on reports of the Baghdad evacuation with Brent crude futures at $69.18 a barrel. Earlier on Wednesday Britain's maritime agency warned that increased tensions in the Middle East may lead to an escalation in military activity that could impact shipping in critical waterways. It advised vessels to use caution while travelling through the Gulf, the Gulf of Oman and the Straits of Hormuz, which all border Iran. Iraq, a rare regional partner of both the United States and its arch regional foe Iran, hosts 2,500 U.S. troops and has Tehran-backed armed factions linked to its security forces. Tensions inside Iraq have heightened since the start of the war in Gaza in October 2023, with Iran-aligned armed groups in the country repeatedly attacking U.S. troops. Top U.S. regional ally Israel has also struck Iran-linked targets across the region, including Iraqi armed groups operating both inside Iraq and in neighboring Syria. Iran's U.N. mission on Wednesday posted on X: "Threats of 'overwhelming force' won't change facts: Iran is not seeking a nuclear weapon and U.S. militarism only fuels instability." The statement appeared to be a response to an earlier comment by U.S. Central Command chief U.S. Army General Michael Kurilla that he had provided the president with "a wide range of options" to prevent a nuclear-armed Iran.
