Despite data showing a larger than expected drop in crude inventories last week, crude oil futures ended lower on Wednesday.
Concerns about outlook for energy demand amid continued rise in coronavirus cases and imposition of tighter restrictions on movements hurt oil prices.
Hopes of improved demand on the back of the vaccine rollouts across the world and the higher supply cut recently announced by the Saudi Arabia for the next two months also supported oil prices.
Oil futures moved higher early on in the session as Saudi Arabia’s decision to reduce output by 1 million barrels per day in February and March continued to support prices.
West Texas Intermediate Crude oil futures for February settled lower by $0.30 or about 0.6% at $52.91 a barrel.
Brent crude futures were down $0.53 or about 0.94% at $56.05 a barrel.
Data released by Energy Information Administration (EIA) showed crude inventories fell 3.247 million barrels last week, compared with analysts’ expectations for a 2.26 million-barrel draw.
Gasoline stocks rose 4.395 million barrels in the week, more than 1.5 times the expected increase. Distillate stockpiles were up by 4.786 million barrels last week, much larger than an expected rise of 2.67 million barrels.
The American Petroleum Institute’s report showed crude inventories in the U.S. dropped by 5.8 million barrels for the week ending January 8. Analysts had predicted an inventory draw of around 2.3 million barrels for the week.
The material has been provided by InstaForex Company – www.instaforex.com