Oil falls on the shock of US stock increases and Opec supply worries
US crude and petrol inventories rise unexpectedly; Opec may decide to raise oil output as soon as June due to worries over Iranian and Venezuelan supply
New York — Oil benchmarks fell on Wednesday after an unexpected build in US crude and petrol inventories despite strong demand, and as traders weighed the possibility of an increase in oil cartel Opec crude output to cover any shortfalls in supply from Iran and Venezuela. US crude inventories rose 5.8-million barrels last week, while petrol stocks increased by 1.9-million barrels, the Energy Information Administration (EIA) said. Both builds were unexpected, as a Reuters poll called for a drawdown in both figures as summer demand starts to heat up. Overall demand for refined products in the US has kept refining activity buoyant, helping drain crude inventories in the world’s largest consuming nation. "A 5.8-million-barrel build is kind of like a slap in the face, where it’s like, ‘Where did this oil come from?’ And as you look through the numbers, it doesn’t make a lot of sense," said Phil Flynn, analyst at Price Futures Group in Chicago. "It is definitely a shock to the system." Th...
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