Oil prices fall as U.S. inventories rise
Larger-than-expected declines in gasoline and distillate stockpiles also helped ease the impact on prices.
Oil prices fell on Wednesday due to a rise in U.S. crude inventories, but concerns over potential disruptions in Iranian supply caused by the Middle East conflict and Hurricane Milton in the U.S. helped limit the decline.
Brent crude futures dropped 60 cents, or 0.78%, to $76.58 per barrel, while West Texas Intermediate (WTI) futures fell 33 cents, or 0.45%, to $73.24.
U.S. crude inventories rose by 5.8 million barrels to 422.7 million barrels last week, according to the Energy Information Administration (EIA), surpassing analysts’ expectations of a 2 million-barrel increase, as per a Reuters survey. However, the buildup was smaller than the estimates provided on Tuesday by the American Petroleum Institute (API), which helped cushion the drop in oil prices.
Larger-than-expected declines in gasoline and distillate stockpiles also helped ease the impact on prices. The gasoline inventory drawdown, possibly influenced by the hurricane, provided an additional bullish factor for the market.
Meanwhile, the U.S. was bracing for a second hurricane, Milton, expected to make landfall in Florida on Wednesday. The storm has already driven up gasoline demand in the state, contributing to the support for crude prices.
Earlier in the session, both Brent and WTI had gained over 1%, after Tuesday’s more than 4% plunge caused by the possibility of a ceasefire between Hezbollah and Israel. However, markets remain cautious due to the risk of an Israeli attack on Iranian oil infrastructure.
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