TOKYO/SINGAPORE — Oil edged lower on Thursday after a build in US gasoline and diesel inventories and cuts to Saudi Arabia’s July prices for Asian crude buyers, with global economic uncertainty weighing on prices as well.
Brent crude futures fell 1 cent to $64.85 a barrel. US West Texas Intermediate crude lost 11 cents, or 0.2 percent, dropping to $62.74 a barrel.
Oil prices closed around 1 percent lower on Wednesday after official data showed that U.S. gasoline and distillate stockpiles grew more than expected, reflecting weaker demand in the world’s top economy.
Adding to the weakness, Saudi Arabia, the world’s biggest oil exporter, cut its July prices for Asian crude buyers to nearly the lowest in four years.
“While the (Saudi) decrease was smaller than anticipated, it suggests demand is soft despite entering the peak demand period,” said ANZ analysts in a note.
The price cut by Saudi Arabia follows the OPEC+ move over the weekend to increase output by 411,000 barrels per day for July. OPEC+ is made up of members of the Organization of the Petroleum Exporting Countries and allies such as Russia.
The strategy of OPEC+ group leaders Saudi Arabia and Russia is partly to punish over-producers and to wrestle back market share, Reuters has reported.
Weak U.S. economic data and ongoing developments in US-China trade relations also weighed on oil prices, said independent market analyst Tina Teng.
“Simply put, a gloomy global economic trajectory dimmed the demand outlook,” she said.
