Oil futures edged lower Wednesday after a report pointed to a bigger-than-expected inventory build in the U.S., while investors watched for a further inventory update to affirm signs of rising supplies.
Late Tuesday, the American Petroleum Institute showed that U.S. crude supplies rose by roughly 4.3 million barrels for the week ended Nov. 1, according to sources. The report comes ahead of the more closely followed inventory report from U.S. Energy Information Administration due at 10:30 a.m. Eastern Time, later Wednesday.
The EIA data are expected to show crude inventories up by 2.7 million barrels last week, according to analysts polled by S&P Global Platts.
West Texas Intermediate crude for December delivery CLZ19, -0.59% lost 25 cents, or 0.4%, to trade at $56.98 a barrel on the New York Mercantile Exchange, after the U.S. benchmark settled 1.2% higher Tuesday.
“The build [shown in API] was almost triple analysts’ forecast and delivered a brief reminder that oversupply concerns are not going away anytime soon,” said Edward Moya, senior market analyst at brokerage Oanda, in a daily research note.
The API report also reportedly showed stockpile declines of about 4 million barrels for gasoline and 1.6 million barrels for distillates. S&P showed forecasts for supply declines of 2.4 million barrels for gasoline and 1 million barrels for distillates, which include heating oil.
Investors also watched reports that Saudi Arabia is set to push the Organization of the Petroleum Exporting Countries to make deeper oil-production cuts by pressuring laggard members ahead of its state-run oil company’s massive initial public offering, which could value its Saudi Aramco at $4 trillion.
Worries about weakening global growth and a trade war between China and the U.S. has helped to depress energy prices, along with rising production in the U.S.