U.S. Oil Prices Fall before EIA Weekly Supply Report

Crude prices showed a slightly lower output during early dealings made on Wednesday. This happened as investors waited on the weekly supply data due to come out later in the day.

oil pump against setting sun

Oil pumps in the field are shadowed against the setting sun.

The U.S. Energy Information Administration (EIA) is due to release its official weekly oil supplies report for the week ended December 01 at 10:30AM ET (1530GMT). Investors expect to find sizable gain in U.S. gasoline and fuel supplies after the weekly supply report is given.

The American Petroleum Institute (API) stated that U.S. oil inventories fell nearly 5.5 million barrels last week. Analysts expected a decline of about 3.4 million barrels.

However, the API report also showed an increase of about 9.2 million barrels in gasoline stocks. While distillate stocks, like motor diesel and heating oil, also increased by an estimated 4.3 million barrels.

The API estimates and the official figures from EIA were known to have sharp differences.

U.S. West Texas Intermediate (WTI) crude futures fell 0.2 percent or 10 cents to $57.52 per barrel by 3:35AM ET (0835GMT), following an increase of 0.3 percent the day before.

Brent crude futures, which are the benchmark for oil prices outside the U.S, on the other hand were at $62.91 per barrel. It was up by 0.1 percent or 6 cents from previous close. The contract had a gain of 0.6 percent in the previous session.

In other energy trading, gasoline futures rose 0.5 percent or 0.8 cents to $1.710 per gallon. Meanwhile, heating oil dropped 0.4 cents to $1.910 per gallon.

Natural gas futures climbed 0.8 percent or 2.2 cents to $2.936 per million British thermal units.

OPEC Boost

Oil prices were able to attain a slight gain during a range-bound session as it was supported by OPEC’s agreement to extend production cuts till next year.

An agreement was made last week by the producer group, joined by some non-OPEC members led by Russia. The deal was made to extend current oil output cuts for nine more months until the end of 2018.

The deal of oil output cut by 1.8 million barrels per day was started last winter by OPEC, Russia, and nine other global producers. It was meant to end in March 2018, and has already been extended once.

Market participants raised concerns regarding the fears of rising U.S. output dampening OPEC’s efforts to get rid of excess supplies in the market. These fears prevented the prices to rise further.

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