Oil prices go down as US Crude, fuel inventories rekindle demand concerns

11 Jan 2023 , 09:33 AM

Oil prices fell on Wednesday, wiping out the previous session’s gains, as industry data revealed an unexpected build in crude and fuel inventories in the United States, the world’s largest oil user, rekindling concerns about fuel demand.

At 0134 GMT, US West Texas Intermediate (WTI) crude futures were down 59 cents, or 0.8%, to $74.53 a barrel. While Brent crude futures were down 62 cents, or 0.8%, to $79.48 a barrel.

According to data from the American Petroleum Institute, crude stocks in the United States increased by 14.9 million barrels in the week ending January 6. Simultaneously, distillate stocks, which include heating oil and jet fuel, increased by approximately 1.1 million barrels.

Traders will be watching for inventory data from the United States Energy Information Administration, which is due later on Wednesday, to see if it resembles the API’s preliminary view.

Worries about interest rate hikes in the United States to combat inflation have dragged down the oil market, offsetting hopes for fuel demand growth in China, the world’s second-largest oil consumer, as it eases COVID-19 restrictions and resumes international travel.

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