US Crude Inventories Rise, Taming Oil Price Rally
Oil prices fell on Wednesday after an unexpectedly large build in US crude inventories tempered supply concerns. Despite Saudi Arabia's cuts to oil shipments to Europe and disruptions to physical supplies, market sources said that API data showed a 7.1 million barrel increase in US crude inventories last week.
The rise in inventory levels, which contrasted with analysts' expectations of a draw of about 1.6 million barrels, weighed on prices. However, regional stock increases do not change the underlying tightness in the global crude market, according to Haitong Futures.
Traders are still focused on disruptions to physical supplies, particularly Saudi Arabia's East-West pipeline and Yanbu export infrastructure. The suspension of oil loadings at Yanbu port after attacks by Yemen's Iran-aligned Houthis has further constrained crude flows.