Oil Dips as US Stocks Rebound Amid Weak Demand in Asia
Oil dips mid-week as the United States crude stocks rebound more than expected amidst weak demand in the Asian region. The Organisation of Petroleum Exporting Countries and allies keep to incremental oil supply despite global energy crunch.
Saudi Arabia had on Monday cut oil prices to buyers in the Asian region, signalling a weak demand posture.
Today, the International benchmark Brent traded at $84.98 a barrel, declining 0.78% from $85.65 a barrel as investors are now focusing on the meeting of major oil-producing countries scheduled next week.
American benchmark West Texas Intermediate (WTI) traded at $83.84 per barrel at the same time, dropping 0.95% from $84.65 a barrel at the end of the previous trading session.
Although oil prices continued a bullish streak with Brent yet again testing levels over $86 a barrel, gains were limited after the American Petroleum Institute (API) announced an estimated rise in US crude oil inventories of over 2.3 million barrels, relative to the market expectation of a 1.65 million-barrel increase.
API also estimated an increase in gasoline inventories by 500,000 barrels.
After US crude oil inventories recorded a fall of 400,000 barrels last week against an anticipated 2.2 million-barrel rise, the new projected massive increase in crude and gasoline stocks led to investor caution.
Investors are also keeping tabs on the meeting next week of the Organization of Petroleum Exporting Countries and allies, also known as OPEC+. However, the market expects the group to preserve its monthly strategy of boosting output by 400,000 barrels per day.
US crude oil stocks, including those in the Strategic Petroleum Reserve, rose by 3.2 million barrels in the week ended Oct. 22 following a decrease of 2.1 million barrels in the previous week.
Excluding inventories in the SPR, commercial crude oil stocks rose by 4.3 million barrels after a 400,000 barrel decline in the previous week, a larger increase than the 2 million barrel increase expected in a survey compiled by Bloomberg.
Stocks in the SPR fell by 1.1 million in the week after declining by 1.7 million in the previous week.
Overall crude oil stocks were up 0.3% from the previous week and were down 7.7% from a year earlier. Crude oil inventories are about 6% lower than the five-year average for this time of the year.
Gasoline stocks fell by 2 million barrels, slightly less than the 2.2 million barrel decrease expected. Gasoline stocks were down 0.9% from the previous week and down 4.6% from a year earlier.
Distillate stocks fell by 400,000 barrels in the current week, compared with a larger expected decrease of 2.3 million barrels. Distillate stocks were down 0.3% from the previous week and were 20% lower than in the same week a year ago.
Refineries operated at 85.1% of their capacity, up from 84.7% in the previous week. #Oil Dips as US Stocks Rebound Amid Weak Demand in Asia. Read Also: Oil Dips as U.S Seeks to Tackle Tight Energy Condition
