Crude oil prices drifted lower on Wednesday on data showing a rise in inventories, and amid concerns about outlook for near term energy demand due to the impact of the coronavirus outbreak on the global economy.
Oil’s decline was not any significantly sharp as traders noted reports indicating the possibility of OPEC stepping in to support prices by extending crude output reduction.
West Texas Intermediate crude oil futures for March ended down $0.15, or about 0.3%, at $53.33 a barrel.
Brent crude oil futures were up $0.26 at $59.77 a barrel.
Concerns about energy demand continued to weigh on oil prices. However, worries eased after the head of the World Health Organization (WHO) said he was confident in China’s ability to contain the virus outbreak.
OPEC wants to extend oil output cuts until at least June from March, with the possibility of deeper reductions on the table if oil demand in China is significantly impacted by the coronavirus outbreak, media reports quoted OPEC sources as saying.
According to data released by Energy Information Administration (EID), crude Oil inventories rose by 3.5 million barrels in the week ended Jan. 24, compared to expectations for a build of 482,000 barrels.
Gasoline inventories were up by 1.2 million barrels, slightly less than an expected increase. Meanwhile, distillates stocks were down 1.3 million barrels last week, more than an expected drop of about 1.1 million barrels.
Data from industry group the American Petroleum Institute showed on Tuesday that U.S. oil inventories fell by 4.3 million barrels for the week ended Jan.24, compared with analysts’ expectations of a gain of 482,000 barrels.