“U.S. crude oil inventories are at historically high levels for this time of year”, the EIA noted.
Advertisement
“We think people really had a June rate hike off the table”, said Tariq Zahir, crude trader and managing partner at Tyche Capital Advisors in NY. Gasoline supplies probably declined by 1.25 million barrels last week, according to the median estimate in the Bloomberg survey.
The dollar rose against its peers after the Fed on Wednesday published minutes of its latest monetary policy meeting that suggest a June hike is possible.
Oil prices have rebounded strongly since plunging to near 13-year lows under $30 in February but are still well below peaks of more than $100 a barrel reached in June 2014.
On Tuesday, the American Petroleum Institute (API) reported a 1.1-million-barrel drop in US crude oil supplies, a smaller dip than the 3 million barrels forecast by S&P Global Platts.
US West Texas Intermediate for June delivery rose 48 cents, or 1.01pc, to $48.20 a barrel.
Both contracts closed higher Tuesday, with the WTI settling at $48.31, its highest since early October.
International Brent crude futures were trading at $49.10 per barrel at 0128 GMT, up 29 cents or 0.59 percent from their last settlement.
The market will rebalance in the third or fourth quarter of the year as demand increases, pushing prices to $50 a barrel by the end of the year, Anas Al-Saleh, Kuwait’s acting oil minister, said in an interview Wednesday in Kuwait City. “However, prices could quickly drop back again once at least some of this supply comes back on stream”.
Oil prices fell early on Thursday, pulled down by rising USA crude inventories, a stronger dollar and surging output from Iran to Europe and Asia.
Brent crude slipped $1.29 at $47.64, while U.S. crude dropped $1.06 at $47.13 a barrel, Reuters reported.
A push above $50 a barrel could also trigger some oil operators to restore production, he said. It was the highest close since Nov 3.
Crude supplies at Cushing, Okla., the delivery point for WTI and the nation’s biggest oil-storage hub, climbed by 461,000 barrels to 68.3 million.
Distillate stockpiles, which include diesel and heating oil, fell 3.2 MMbbl, versus expectations for a 642,000-bbl drop, the EIA data showed.
As mentioned before in the BRICS Post, Iran has pledged to increase its production following the removal of economic sanctions to an additional 1 million barrels a day.
Advertisement
In Nigeria, output has fallen to its lowest level in two decades, at roughly 1.65 MMBPD, due to attacks and sabotage.
