Mubasher: Oil prices dropped on Wednesday, dragged down by a bigger-than-anticipated buildup in US crude inventories, snapping three consecutive sessions of gains on hopes of a thaw in US-Sino trade tensions, according to Reuters.
By 6:16 am GMT, US Nymex crude futures fell by 0.44% to $56.98 per barrel (pb), having recorded a 1.2% gain by the end of the preceding session, while global benchmark Brent futures dropped by 0.49% to $62.65 pb, after closing 1.3% higher.
Crude stockpiles in the US saw a rise of 4.3 million barrels to 440.5 million barrels in the week to 1 November, the industry-funded group the American Petroleum Institute (API) said.
This came as almost thrice as a forecast for a 1.5 million barrel increase, according to analysts polled by Reuters.
The US Department of Energy is due to release its weekly inventory report later in the day.
Nevertheless, the slide was capped by hopes that the trade negotiations between the US and China yield a breakthrough progress.
Beijing wants Washington to remove further tariffs levied on Chinese goods, as part of a “Phase One” trade deal, Reuters said, citing sources familiar with the issue.
Back to the supply front, oil market outlook may be tilted to the upside, Secretary-General of the Organization of the Petroleum Exporting Countries (OPEC) Mohammad Barkindo said.
However, in the upcoming five years, the producer club expected its oil supply share to shrink, pulled down by growing US shale output and other non-OPEC producers.