Home Headlines Oil prices ease on U.S. inventory build, China COVID worries
Our website publishes news, press releases, opinion and advertorials on various financial organizations, products and services which are commissioned from various Companies, Organizations, PR agencies, Bloggers etc. These commissioned articles are commercial in nature. This is not to be considered as financial advice and should be considered only for information purposes. It does not reflect the views or opinion of our website and is not to be considered an endorsement or a recommendation. We cannot guarantee the accuracy or applicability of any information provided with respect to your individual or personal circumstances. Please seek Professional advice from a qualified professional before making any financial decisions. We link to various third-party websites, affiliate sales networks, and to our advertising partners websites. When you view or click on certain links available on our articles, our partners may compensate us for displaying the content to you or make a purchase or fill a form. This will not incur any additional charges to you. To make things simpler for you to identity or distinguish advertised or sponsored articles or links, you may consider all articles or links hosted on our site as a commercial article placement. We will not be responsible for any loss you may suffer as a result of any omission or inaccuracy on the website.

Oil prices ease on U.S. inventory build, China COVID worries

by uma

By Sonali Paul and Isabel Kua

SINGAPORE (Reuters) -Oil prices slid on Wednesday as industry data showed U.S. crude stockpiles rose more than expected and on worries a rebound in COVID-19 cases in top importer China would hurt fuel demand.

Brent crude futures fell 44 cents, or 0.5%, to $94.92 a barrel by 0454 GMT, while U.S. West Texas Intermediate (WTI) crude futures fell 53 cents, or 0.6%, to $88.38 a barrel. The benchmarks fell around 3% on Tuesday.

U.S. crude oil inventories rose by about 5.6 million barrels for the week ended Nov. 4, according to market sources citing American Petroleum Institute figures, while seven analysts polled by Reuters estimated on average that crude inventories would rise by about 1.4 million barrels.

Last week, the market had latched on to hopes that China might be moving toward relaxing COVID restrictions but over the weekend health officials said they would stick to their “dynamic-clearing” approach to new infections.

COVID cases in Guangzhou and other Chinese cities have surged, with the global manufacturing hub becoming the country’s newest COVID epicentre.

“With that (China reopening) narrative getting pushed back, coupled with a considerable build on U.S. inventory data, implying dimming U.S. demand, the recessionary crews are back out in full force this morning in Asia,” Stephen Innes, managing partner at SPI Asset Management, said in a note.

CMC Markets analyst Tina Teng said despite tight supply in the physical markets, China’s slowdown in demand has a major impact on the oil futures markets.

In another bearish sign, API data showed gasoline inventories rose by about 2.6 million barrels, against analysts’ forecasts for a 1.1 million drawdown.

The market will be looking out for official U.S. inventory data from the Energy Information Administration due at 10:30 a.m. EST (1530 GMT) for a further view on demand in the world’s biggest economy.

Meanwhile, supply concerns remain as a European Union ban on Russian crude looms and the Organization of the Petroleum Exporting Countries and allies, or OPEC+, cuts output.

The EU will ban Russian crude imports by Dec. 5 and Russian oil products by Feb. 5, in retaliation to Russia’s invasion of Ukraine.

(Reporting by Sonali Paul in Melbourne and Isabel Kua in Singapore; Editing by Himani Sarkar)

 

You may also like