Crude oil prices fell for a fourth day on Wednesday, as jittery investors awaited official U.S. stockpile figures later in the day after industry data showed a surprise build in inventories, underlining a persistent global glut.
The American Petroleum Institute said crude stockpiles rose by 9.3 million barrels in the week to Oct. 28, more than nine times the amount expected by analysts polled by Reuters. [API/S]
U.S. West Texas Intermediate crude CLc1 had fallen 42 cents, or 0.9 percent, to $46.25 by 0740 GMT. On Tuesday, it dipped 19 cents to $46.67. Brent crude LCOc1 was down 32 cents at $47.82, near a one-month low of $47.72 hit in the prior session.
Prices have slumped in recent days as hopes have faded that oil producers would settle their differences and agree to output cuts when the Organization of the Petroleum Exporting Countries (OPEC) meets on Nov. 30.
“Those who were hoping for some upside from any sort of production agreement appear to have their hopes dashed,” said Ric Spooner, chief market analyst at CMC Markets in Sydney. “It looks like there are speculative longs quitting the market.”
Indications of higher-than-expected U.S. stockpiles are also dragging on sentiment.
The API report typically comes a day before official inventory data from the U.S. government’s Energy Information Administration (EIA). [EIA/S]
The API bases its numbers on voluntary reporting by members, while the EIA uses a bigger sample. Traders say oil prices could drop further if the government data confirms the large build.
Meanwhile, Saudi Aramco, the state-owned producer from Saudi Arabia, expects prices to rise in the first half of 2017 as the market returns to balance and demand is seen as strong, Chief Executive Officer Amin Nasser said late on Tuesday.
Nasser also said the preparations for the oil giant’s initial public offering are going well and reiterated the target for listing remains sometime in 2018.