Oil Prices Slip as Traders Brace for U.S. Inventory Surge, Await OPEC Report
Global Oil Markets — The international oil market witnessed a notable dip on Wednesday as Brent crude futures fell by 64 cents, reaching $65.99 per barrel, while U.S. West Texas Intermediate (WTI) similarly dropped to $63.03 per barrel. This market fluctuation comes amid speculation over a potential rise in U.S. crude inventories and anticipation surrounding the latest monthly oil report from the Organization of the Petroleum Exporting Countries (OPEC).
Analysts pointed to the latest figures from the American Petroleum Institute (API), which reported a crude stock increase of approximately 4.3 million barrels for the week ending May 9. This build-up sparked concerns among traders already wary of oversupply risks, even as gasoline inventories decreased by 1.4 million barrels and distillates saw a larger-than-expected drop of 3.7 million barrels.
“Definitely, the crude build in the API numbers was not of help,” commented Giovanni Staunovo, oil analyst at UBS. “However, the drawdowns in refined products offer a silver lining, especially with summer driving season approaching in the Northern Hemisphere.”
Meanwhile, analysts from Roth Capital Markets highlighted that the drawdown in gasoline and distillate inventories could point to longer-term strength in oil demand, signaling that the market may be under-supplied heading into the peak travel season.
All eyes are now on the U.S. Energy Information Administration (EIA), which is expected to release its official inventory data at 10:30 a.m. EDT (1430 GMT). Preliminary polls suggest a mixed outlook: while crude and gasoline inventories are expected to decline, distillate stocks may show a modest rise.
Simultaneously, the market is also bracing for OPEC’s monthly oil report, due later today. Analysts believe that secondary source supply numbers and commentary on production cuts will be key indicators of the cartel’s strategy amid shifting global energy demand.
With market sentiment balancing between short-term volatility and long-term demand optimism, energy investors are advised to monitor inventory trends and geopolitical shifts closely.
