SEOUL (Reuters) – Oil prices fell on Wednesday, pulled down by a larger-than-expected build in U.S. crude stocks, after gaining for three sessions on expectations of an easing in U.S.-China trade tensions.
Brent crude futures LCOc1 stood at $62.58 a barrel by 0738 GMT, down 38 cents, or 0.6%. Brent settled up 1.3% on Tuesday.
U.S. West Texas Intermediate (WTI) crude CLc1 futures fell 30 cents, or 0.5%, to $56.93 per barrel, having closed up 1.2% in the previous session.
U.S. crude inventories rose by 4.3 million barrels in the week ended Nov. 1 to 440.5 million barrels, according to data from the American Petroleum Institute (API) released on Tuesday. That was nearly triple analysts’ forecast for an increase of 1.5 million barrels.
Official data from the Energy Information Administration (EIA) is due later on Wednesday.
“This morning’s price action suggests that Asia is being more circumspect about oil and is concerned that bearish news was ignored entirely overnight,” said Jeffrey Halley, a senior market analyst at OANDA.
However, hopes remain for a breakthrough on trade in talks between the United States and China, the world’s two biggest oil consumers, keeping price falls in check.
As part of a ‘Phase One’ U.S.-China trade deal, China is pushing President Donald Trump to drop more tariffs imposed on Beijing, say people familiar with the negotiations.
“Investors will continue to take cues from U.S.-China trade talks,” ANZ Research said in a note.
Looking ahead, next year’s oil market outlook may have upside potential, Mohammad Barkindo, the secretary-general of the Organization of the Petroleum Exporting Countries (OPEC), said on Tuesday.
But in the next five years, OPEC will supply a diminishing amount of oil, squeezed by rising U.S. shale output and other rival sources, according to the oil producer group’s 2019 World Oil Outlook.
OPEC and its partners, including Russia, previously agreed to cut oil production by 1.2 million barrels a day until March 2020. They will meet in early December to review output policy.
Reporting by Jane Chung; Editing by Richard Pullin and Clarence Fernandez