LONDON (Reuters) – Oil prices fell on Wednesday after industry data showed an unexpected build-up of U.S. crude inventories and as investors waited to see if a fresh round of tariffs by Washington on Chinese goods would come into force on Sunday.
FILE PHOTO: Oil pump jacks work at sunset near Midland, Texas, U.S., August 21, 2019. Picture taken August 21, 2019. REUTERS/Jessica Lutz
Brent futures LCOc1 fell 34 cents to $64 per barrel by 1430 GMT. West Texas Intermediate crude CLc1 slipped 21 cents to $59.03 a barrel.
U.S. crude stocks clocked a surprise rise in the most recent week while gasoline and distillate inventories also rose, data from industry group the American Petroleum Institute shows.
Crude inventories rose by 1.4 million barrels in the week to Dec. 6 to 447 million. Analysts were expecting a fall of 2.8 million barrels. [API/S]
Government data from the weekly U.S. Energy Information Administration (EIA) report is due at 1530 GMT. [EIA/S]
U.S.-China trade tensions continue to cloud the outlook for demand, with a Dec. 15 deadline for the next round of U.S. tariffs on Chinese imports approaching.
“The post-OPEC bullish jolt is all but a distant memory,” said PVM oil market analysts, referring to a decision last week by OPEC and allied oil producers led by Russia to deepen supply cuts amid a weak outlook for oil demand growth next year.
“Oil prices have struggled for traction this week as demand concerns returned to the fore… The cautionary mood is likely to prevail as investors await fresh cues on the trade front.”
On the supply side, the U.S. is on track to become a net exporter of crude and fuel for the first time since records began on an annual basis in 2020, the EIA said, due to a production surge that has dramatically reduced its dependence on foreign oil.
Aramco 2222.SE, Saudi Arabia’s national oil company, listed on the domestic stock exchange on Wednesday, with shares surging the maximum permitted 10% above their IPO price in a move hailed by the government as a vindication of its towering $2 trillion valuation of the state oil company.
Elsewhere, Venezuela’s crude output in November jumped more than 20% from October to the highest level since the U.S. tightened sanctions on state oil company PDVSA in August, two people with knowledge of PDVSA data said this week.
Investors are also eyeing other major events this week, including the UK’s general election on Thursday and U.S. and European Central Bank meetings.
Additional reporting by Jessica Jaganathan in Singapore; editing by Jason Neely and Mike Harrison