Oil Prices Fall on Unexpected US Inventory Buildup
Oil prices fell on global markets this week after an unexpected increase in US crude inventories. The American Petroleum Institute reported that US crude oil stocks rose by 7.1 million barrels in the week ended September 11, contrary to analysts' expectations of a decline of around 1.6 million barrels.
The buildup of gasoline and diesel fuel also contributed to lower prices, according to Haitong Futures. However, the firm noted that this regional increase does not change the overall tightness in the global crude oil market.
The previous day, both benchmark oil grades rose by over $3 and reached their highest levels since May 19 due to supply concerns after shipments were suspended in Yanbu and Saudi Arabia cut oil supplies to Europe. The East-West pipeline was shut following an attack on Friday by Iran-linked Yemeni Houthis, halting about 4 million barrels of oil per day - roughly 4% of global supplies.
US energy secretary stated that oil transportation through the pipeline could resume within a few days, but Reuters sources gave differing assessments of the duration of repairs. One suggested that the work could take five to six weeks, while another did not rule out a partial resumption of pumping earlier.