Middle East Disruptions and US Inventory Build Weigh on Oil Prices
Oil prices took a step back on Wednesday after a two-day rally that pushed them to their highest levels since May 19. The decline came as market participants focused on supply disruptions in the Middle East and an unexpected build in US crude inventories.
The Brent crude futures contract fell by $1.22, or 0.67%, to $107.53 a barrel, while the West Texas Intermediate (WTI) futures contract was down $1.64, or 1.55%, at $104.19 a barrel.
US crude oil inventories rose by 7.1 million barrels in the week ended September 11, according to data from the American Petroleum Institute (API). This was significantly higher than analysts' expectations of a draw of about 1.6 million barrels, as reported by Reuters.
Haitong Futures noted that while regional stock increases do not change the underlying tightness in the global crude market, the unexpected builds in gasoline and diesel inventories have weighed on prices.