Crude oil futures were lower during mid-morning trade in Asia Thursday amid an expected build of US crude stocks last week, while positive comments on the OPEC deal stalled the price fall. At 9:55 am Singapore time (0155 GMT), ICE April Brent crude futures were down 26 cents/b (0.39%) from Wednesday’s settle at $66.82/b, while the new front-month NYMEX April light sweet crude contract was down 8 cents/b (0.11%) at $57.08/b.
According to analyst reports quoting the American Petroleum Institute data out on Wednesday, US crude stocks for the week ended February 15 were up 1.3 million barrels. Analysts surveyed Tuesday by S&P Global Platts were looking for US crude stocks to have increased by 3.5 million barrels for the same period. US gasoline and distillate stocks on the other hand dropped 1.6 million barrels and 758,000 barrels respectively last week, according to API report, said analysts.
“API data more friendly than expected with a surprise drops in products, ” The Price Futures Group analyst Phil Flynn said in a note. The more definitive numbers on last week’s US inventory data is due for release from the US Energy Information Administration later Thursday. The EIA on Tuesday predicted that US shale oil production will increase by 84,000 b/d to a record high of 8.4 million b/d in March, which cast a bearish tone on prices, analysts said. “It seems that the sharp rise in oil production in the US is having a slowing effect on crude prices,” Commerzbank analysts said in a note.
Crude prices meanwhile found some support from Saudi Arabia’s energy minister Khalid al-Falih’s comments on Wednesday where he said that the kingdom has received pledges of commitment from OPEC members and the group’s oil producer allies to cut production levels in line with their current output agreement.