Middle East Disruptions, US Inventory Build Weigh on Crude Prices

Crude prices took a hit on Wednesday after an unexpected build in US crude inventories weighed on markets. Brent crude futures fell by $0.73, or 0.67%, to $108.02 a barrel at 0450 GMT, while U.S. West Texas Intermediate futures dropped $1.1, or 1.04%, at $104.73 a barrel.

The two-day rally that saw prices rise by over $3 and reach their highest levels since May 19 was halted as the market digested the news of the inventory build. According to data from the American Petroleum Institute, US crude oil, gasoline, and distillate inventories all rose last week, with crude inventories increasing by 7.1 million barrels.

Despite the unexpected build, prices remained resilient due to ongoing supply disruptions in the Middle East. Saudi Arabia's East-West pipeline was shut down after an attack on its energy facilities, and oil loadings at Yanbu port were suspended. The country is offering more crude oil loadings to Asian refiners via ship-to-ship transfers off Oman's Sohar port.