Crude closed near a six-week low in New York after U.S. inventories declined by less than analysts projected, according to Bloomberg.
Crude stockpiles fell 930,000 barrels to 527.8 million, the Energy Information Administration reported Wednesday – less than a third of the 3 million-barrel decline forecast by analysts surveyed by Bloomberg. Production advanced to 9.29 million barrels a day last week, the highest since August 2015. Gasoline inventories increased as demand falters. Prices had risen as much as 1.2 percent in New York before the report was released.
Oil has fallen the past two weeks on concern that increasing U.S. output will offset efforts by the Organization of Petroleum Exporting Countries and its allies to eliminate a global glut. OPEC will meet again May 25 in Vienna to decide whether to extend the cuts through the second half of the year. Russia believes in prolonging the curbs, a Russian government official said.
”Crude inventories fell, because they always do at this time of year,” Stephen Schork, president of Schork Group Inc., a consulting company in Villanova, Pennsylvania, said by telephone. ”This is the 11th straight-weekly gain in production and heading for a modern-day record by the end of the year. I don`t see any way you can spin this as bullish.”
West Texas Intermediate for June delivery rose 16 cents to close at $47.82 a barrel on the New York Mercantile Exchange. Futures tumbled 2.4 percent to $47.66 on Tuesday, the lowest close since March 21. Total volume traded was about 4 percent above the 100-day average.
Brent for July settlement increased 33 cents, or 0.7 percent, to $50.79 a barrel on the London-based ICE Futures Europe exchange. The global benchmark crude closed at a $2.61 premium to July WTI.