Oil Prices Slip as US Crude Build and Middle East Disruptions Weigh

Oil prices slipped on Wednesday after an unexpected build in US crude inventories weighed on markets. Brent crude futures fell $0.73, or 0.67%, to $108.02 a barrel, while US West Texas Intermediate futures were down $1.1, or 1.04%, at $104.73 a barrel.

The two-day rally that pushed prices above their highest levels since May 19 stalled as the American Petroleum Institute reported a 7.1 million-barrel build in crude inventories for the week ended September 11. This was contrary to analysts' expectations of a draw of about 1.6 million barrels, according to Reuters.

Despite the inventory pressure, prices remained resilient due to disruptions to physical supplies caused by attacks on Saudi energy facilities and the shutdown of Saudi Arabia's East-West pipeline, said Priyanka Sachdeva, head of market insights at Phillip Nova. European diesel futures rose to a record high on Tuesday, highlighting tightness in fuel markets as Middle East disruptions constrained crude and product flows.

The suspension of oil loadings at Saudi Arabia's Yanbu port and the use of ship-to-ship transfers off Oman's Sohar port after drone attacks damaged its key oil pipeline to the Red Sea have added to supply concerns. Visible vessel transits through the Strait of Hormuz remained in the single digits on Tuesday, down from seven a day earlier.