Oil prices fall as US crude stocks jump

Thursday, 12 December 2019 00:29 - - {{hitsCtrl.values.hits}}

London (Reuters): Oil prices fell on Wednesday after industry data showed an unexpected build-up of US crude inventories and as investors waited to see if a fresh round of tariffs by Washington on Chinese goods would come into force on Sunday.

Brent futures fell 34 cents to $64 per barrel by 1430 GMT. West Texas Intermediate crude slipped 21 cents to $59.03 a barrel.

US crude stocks clocked a surprise rise in the most recent week while gasoline and distillate inventories also rose, data from industry group the American Petroleum Institute shows.

Crude inventories rose by 1.4 million barrels in the week to Dec. 6 to 447 million. Analysts were expecting a fall of 2.8 million barrels.

Government data from the weekly US Energy Information Administration (EIA) report is due at 1530 GMT.

US-China trade tensions continue to cloud the outlook for demand, with a Dec. 15 deadline for the next round of US tariffs on Chinese imports approaching.

“The post-OPEC bullish jolt is all but a distant memory,” said PVM oil market analysts, referring to a decision last week by OPEC and allied oil producers led by Russia to deepen supply cuts amid a weak outlook for oil demand growth next year. “Oil prices have struggled for traction this week as demand concerns returned to the fore... The cautionary mood is likely to prevail as investors await fresh cues on the trade front.” On the supply side, the US is on track to become a net exporter of crude and fuel for the first time since records began on an annual basis in 2020, the EIA said, due to a production surge that has dramatically reduced its dependence on foreign oil.

Also adding to global supply, US producers Exxon Mobil Corp and Hess Corp plan to export the first shipments of crude from Guyana between January and February, sources said.