Oil falls on unexpected build in US crude and fuel inventories
WTI crude futures fell 59c to $74.53 a barrel in early trade, while Brent crude futures were down 62c, at $79.48 a barrel
11 January 2023 - 07:45
bySonali Paul
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Melbourne — Oil prices fell on Wednesday, erasing the previous session’s gains, after industry data showed an unexpected build in crude and fuel inventories in the US, the world’s biggest oil user, which reignited worries about fuel demand.
US West Texas Intermediate (WTI) crude futures fell 59c, or 0.8%, to $74.53 a barrel at 1.34am GMT, while Brent crude futures were down 62c, or 0.8%, at $79.48 a barrel.
US crude stocks jumped by 14.9-million barrels in the week ended January 6, sources said, citing data from the American Petroleum Institute (API). At the same time, distillate stocks, which include heating oil and jet fuel, rose by about 1.1-million barrels.
Analysts polled by Reuters expected crude stocks to fall by 2.2-million barrels and distillate stocks to drop by 500,000 barrels.
Traders will be looking out for inventory data from the US Energy Information Administration (EIA) due later on Wednesday to see if it matches the preliminary view from API.
The oil market has been pulled lower by worries about US interest rate hikes to curb inflation, which would trigger a recession and curtail fuel demand, offsetting hopes for fuel demand growth in China, the world’s second-largest oil consumer, as it eases Covid-19 curbs and resumes international travel.
“Monday’s news that China had issued a fresh batch of import quotas suggests the world’s largest importer is ramping up to meet higher demand,” ANZ Research analysts said in a note.
The big focus this week is on US inflation data, due on Thursday. If inflation comes in below expectations that would drive the dollar down, analysts said. A weaker dollar can boost oil demand as it makes the commodity cheaper for buyers holding other currencies.
Support our award-winning journalism. The Premium package (digital only) is R30 for the first month and thereafter you pay R129 p/m now ad-free for all subscribers.
Oil falls on unexpected build in US crude and fuel inventories
WTI crude futures fell 59c to $74.53 a barrel in early trade, while Brent crude futures were down 62c, at $79.48 a barrel
Melbourne — Oil prices fell on Wednesday, erasing the previous session’s gains, after industry data showed an unexpected build in crude and fuel inventories in the US, the world’s biggest oil user, which reignited worries about fuel demand.
US West Texas Intermediate (WTI) crude futures fell 59c, or 0.8%, to $74.53 a barrel at 1.34am GMT, while Brent crude futures were down 62c, or 0.8%, at $79.48 a barrel.
US crude stocks jumped by 14.9-million barrels in the week ended January 6, sources said, citing data from the American Petroleum Institute (API). At the same time, distillate stocks, which include heating oil and jet fuel, rose by about 1.1-million barrels.
Analysts polled by Reuters expected crude stocks to fall by 2.2-million barrels and distillate stocks to drop by 500,000 barrels.
Traders will be looking out for inventory data from the US Energy Information Administration (EIA) due later on Wednesday to see if it matches the preliminary view from API.
The oil market has been pulled lower by worries about US interest rate hikes to curb inflation, which would trigger a recession and curtail fuel demand, offsetting hopes for fuel demand growth in China, the world’s second-largest oil consumer, as it eases Covid-19 curbs and resumes international travel.
“Monday’s news that China had issued a fresh batch of import quotas suggests the world’s largest importer is ramping up to meet higher demand,” ANZ Research analysts said in a note.
The big focus this week is on US inflation data, due on Thursday. If inflation comes in below expectations that would drive the dollar down, analysts said. A weaker dollar can boost oil demand as it makes the commodity cheaper for buyers holding other currencies.
Reuters
Oil rises as China’s move to reopen borders boosts demand outlook
Oil falls on concerns higher interest rates will limit demand
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