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| Oil storage drums stacked in the Keihin industrial area Kawasaki, Kanagawa Prefecture, Japan, on Monday, April 15, 2024. Toru Hanai | Bloomberg | Getty Images |
Oil prices fell for a third day on Wednesday on rising crude inventories and production in the U.S., the world’s biggest oil consumer, along with increasing hopes of a ceasefire agreement in the Middle East.
Brent crude futures for July fell 47 cents, or 0.5%, at
$85.86 a barrel by 0005 GMT. U.S. West Texas Intermediate crude for June
declined 53 cents, or 0.6%, to $81.40 per barrel.
U.S. crude oil inventories swelled last week by 4.906
million barrels, while gasoline and distillate stockpiles fell, according to
market sources citing American Petroleum Institute figures on Tuesday.
Gasoline inventories fell by 1.483 million barrels, and
distillates fell by 2.187 million barrels. Official data from the EIA is due at
10:30 a.m. EDT (1430 GMT).
U.S. crude supply is also showing signs of ramping up, with
production rising to 13.15 million barrels per day (bpd) in February from 12.58
million bpd in January in its biggest monthly increase in about 3-1/2 years,
the Energy Information Administration said on Tuesday.
Expectations that a ceasefire agreement between Israel and
Hamas could be in sight, following a renewed push led by Egypt to revive
stalled negotiations between the two, pushed oil prices lower. An end to the
war would reduce concerns of a broadening of the conflict that could disrupt
supply from the Middle East.
Keeping oil from slipping further, output by the
Organization of the Petroleum Exporting Countries (OPEC) was seen falling by
100,000 bpd in April to 26.49 million bpd, a Reuters survey found on Tuesday,
reflecting lower exports from Iran, Iraq and Nigeria against a backdrop of
ongoing voluntary supply cuts by some members agreed with the wider OPEC+
alliance.