Investing.com- A surprise increase in U.S. inventories pressured oil prices on Wednesday morning in Asia, along with indications that Russian state oil producer Rosneft is reportedly rethinking a deal with OPEC to withhold supplies.
Crude oil WTI futures were down 0.75%, at $53.08 a barrel by 11:23 PM ET (3:23 GMT). Although it closed 0.4% higher on Tuesday, the benchmark crude is still around 20% below its peak price in April 2018.
International benchmark Brent was down 0.44%, to $61.70 a barrel. Prices ended up 1.1% on Tuesday after a near 13% fall in the previous four sessions.
The American Petroleum Institute (API) said on Tuesday that U.S. crude stocks unexpectedly rose by 3.5 million barrels last week, while gasoline and distillate inventories grew more than expected.
The official inventory data from the U.S. Energy Information Administration (EIA) is due to be released later in the day.
“It was a very bearish number, and if confirmed by the EIA it will hammer prices,” Stephen Innes, managing partner at SPI Asset Management in Bangkok was cited as saying by Reuters.
Saudi Arabia, the de-facto leader of the Organization of the Petroleum Exporting Countries (OPEC), was reported earlier this week to have hinted at extended supply cuts to support oil prices. But one of its allies may have a different opinion.
On Tuesday, the head of Russian oil giant Rosneft, Igor Sechin, was quoted by Interfax news agency as saying “Does it make sense (for Russia) to reduce (oil output) if the U.S. immediately takes (our) market share?” He also reportedly suggested that Russia should pump at will, and he would seek compensation from the government if the cuts were extended.
OPEC, together with its allies, has been withholding production since the start of the year to prop up the market. The group plans to decide later this month or in early July whether to continue to withhold production or not.