MELBOURNE- Oil prices fell in early trade on Wednesday after industry data showed US crude inventories unexpectedly rose last week as a deep freeze in the southern states curbed demand from refineries that were forced to shut.
Crude stockpiles rose by 1 million barrels in the week to Feb. 19, the American Petroleum Institute (API) reported on Tuesday, against estimates for a draw of 5.2 million barrels in a Reuters poll.
API data showed refinery crude runs fell by 2.2 million bpd.
US West Texas Intermediate (WTI) crude futures were down 55 cents or 0.9 percent at $61.12 a barrel, after slipping 3 cents on Tuesday.
Brent crude futures fell 38 cents, or 0.6 percent, to $64.99 a barrel, erasing Tuesday’s 13 cents gain.
Investors will be awaiting confirmation from the US Energy Information Administration later on Wednesday that crude inventories rose last week, despite the hit to shale oil production amid the unprecedented icy spell in the US south.
“The key question is how quickly does US oil supply recover. It looks like supply will recover faster than refineries, and supply is going to outpace demand in the next few weeks. That will give negative weight to the market,” Commonwealth Bank analyst Vivek Dhar said. – Reuters