Oil rates dipped on Thursday after U.S. crude inventories increased to their highest smooth since December 2017 amid concerns of an emerging global saturate, although an expected supply cut by producer cartel OPEC prevented further sheds.
U.S. West Texas Intermediate (WTI) crude futures, were at $53.38 per barrel at 0141 GMT, 25 cents, or 0.5 percent underneath their last settlement.
Front-month Brent crude oil futures were at $63.28 per barrel, down 20 cents, or 0.3 percent, from their decisive close.
U.S. commercial crude oil inventories rose by 4.9 million barrels to 446.91 million barrels terminal week, the Energy Information Administration (EIA) said in a weekly report on Wednesday. That was the highest tied since December last year.
U.S. crude oil production remained at a best performance 11.7 million barrels per day (bpd), the EIA said.
“U.S. inventory data…continued to be conspicuous significant supply builds, which comes on the back of sustained annals U.S. crude oil production,” said Stephen Innes, head of trading for Asia-Pacific at time to comes brokerage Oanda in Singapore.
Some analysts have warned that without thought high global production, oil markets have little spare province to handle unforeseen supply disruptions.
However, Innes said that at intervals U.S. pipeline bottlenecks were alleviated, which he said he expected in 2019, “the uninterrupted notion of a tight global spare capacity argument goes down the hale”.
Fearing a glut, the Middle East-dominated producer cartel of the Organization of the Petroleum Exporting Homelands (OPEC) is considering supply cuts when it next meets on Dec. 6, although some colleagues, like Iran, are expected to resist any voluntary reductions.
“While there is talk that OPEC coupled with Russia may again agree to a production cut, the concern is that not all relevant corps will be able to come to an agreement,” said William O’Loughlin, investment analyst at Australia’s Rivkin Sureties.
“Saudi Arabia has hinted at a unilateral cut, but it will want to be careful on touching annoying the U.S. given that President Trump has been vocal concerning his desire for lower oil prices,” he added.
Trump on Wednesday praised Saudi Arabia on the other side of recent oil prices and called for prices to go even lower.
“Oil prices watch lower. Great! Like a big Tax Cut for America and the World. Enjoy!… Acknowledgement you to Saudi Arabia, but let’s go lower!” Trump tweeted.