Oil Prices Slip on Unexpected Inventory Build

7 Aug 2024 , 09:34 AM

Oil prices fell in early Asian trading on Wednesday, following a small comeback the previous day, when industry data revealed an unexpected build in U.S. crude oil and petrol stocks, countering global oil supply concerns.

Brent crude futures slid 21 cents, or 0.27%, to $76.27 per barrel. US West Texas Intermediate crude fell 25 cents, or 0.34%, to $72.95 a barrel.

Last week, U.S. crude oil, petrol and distillate inventories increased, according to market sources citing American Petroleum Institute numbers on Tuesday.

Benchmarks slipped appropriately. The previous session saw both WTI and Brent rebound from multi-month lows to settle higher.

The API numbers revealed that oil stocks increased by 176,000 barrels in the week ending August 2, according to the sources, who spoke on the condition of anonymity. Reuters polled analysts, who predicted crude stockpiles to fall by 700,000 barrels.

Petrol stockpiles rose by 3.313 million barrels, exceeding experts’ forecasts of a 1 million barrel drop, while distillate stocks increased by 1.217 million barrels, a larger boost than expected.

The US Energy Information Administration is scheduled to disclose weekly inventory statistics at 10:30 a.m. (1430 GMT) on Wednesday.

Brent futures fell to their lowest since early January, while WTI futures fell to their lowest since February, as a worldwide stock market downturn extended amid mounting fears of a recession in the United States, the world’s top petroleum consumer.

However, both benchmarks broke a three-session losing trend on Tuesday as Middle East tensions fuelled supply fears, boosting prices.

Iran’s threat of vengeance against Israel and the United States in response to the assassination of two militant commanders has sparked fears of a larger Middle East conflict.

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