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Oil settles slightly weaker despite major U.S. inventory gain

Investing.com -

Investing.com - Oil prices fell slightly to settle lower in the U.S. on Wednesday despite a surge in inventories as the market continues to welcome an effort to trim global supplies by OPEC and non-OPEC nations.

On the ICE, Brent for April delivery dipped 0.39% to $55.75 a barrel. On the New York Mercantile Exchange, crude oil for delivery in March eased 0.17% to $53.11.

U.S. crude oil inventories jumped 9.5 million barrels last week taking the total to a record 518 million barrels, the Energy Information Administration (EIA) said Wednesday, in line with an industry estimate from the American Petroleum Institute (API) of a 9.94 million barrels build.

Gasoline stocks rose 2.8 million barrel and distillate stockpiles fell by 689,000 barrels, in line with forecasts, EIA said. Last week, crude oil inventories in the U.S. jumped by 13.8 million barrels, the EIA said, a surprise above the expected 2.8 million barrels gain. Also last week, API reported a 14.23 million barrels build in crude stocks.

The builds come against more upbeat estimates of reduce oil output globally.

On Monday, OPEC said output by the cartel members in January fell 890,000 barrels per day (bpd) from December to 32.14 million (bpd), putting the supply and demand balance globally on track to even out this year from a glut. OPEC has agreed to cut 1.2 million bpd and a group of other producers led by Russia will cut by 558,000 bpd in the first six months of the year.

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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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