Date
23 July 2017
Oil rigs lie idle at a depot in North Dakota as crude prices languish. Photo: Reuters
Oil rigs lie idle at a depot in North Dakota as crude prices languish. Photo: Reuters

US crude falls 1.3% on surprise build-up in stockpiles

US crude futures fell more than 1 percent Wednesday after a surprise build-up in stockpiles, while gasoline rallied on bets on strong fuel demand through the peak summer driving season, Reuters reported.

The US Energy Information Administration said inventories rose last week for crude, gasoline and distillates.

That surprised market players a day after the American Petroleum Institute, an industry group, had reported a draw of 1 million barrels.

“We were not supposed to be building crude inventories in early July. This tells me the data will be additive to the macro-based selloff and perhaps make it worse,” Reuters quoted David Thompson, executive vice president at Powerhouse, an energy-specialized commodities broker in Washington, as saying.

Earlier this week, oil prices tumbled to three-month lows on worries about the impact of Greece’s debt woes and China’s stock market plunge on the world economy and fuel demand.

Oil prices also felt pressure from Iran’s eagerness to seal a nuclear accord that will allow it to resume crude exports without sanctions into an already glutted global market.

US crude’s front-month contract settled down 68 US cents, or 1.3 percent, at US$51.65 a barrel. 

Gasoline rallied 2.5 percent.

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