US crude oil inventories rise by 2.9 million barrels: API
Unexpected build in weekly crude stockpiles contrasts with prior drawdowns, pressuring prices ahead of government data.
U.S. crude oil inventories rose by 2.9 million barrels last week, according to data released Tuesday by the American Petroleum Institute, defying analyst expectations of a drawdown.
The unexpected increase, reported after market close, follows five consecutive weeks of declines and marks the largest build since mid-March. Analysts polled by Reuters had forecast a decrease of 1.5 million barrels, underscoring the volatility in oil market fundamentals.
The API report, which is not official but closely watched as a precursor to government figures, showed gasoline inventories fell by 1.8 million barrels, while distillate stockpiles declined by 1.1 million barrels. Refinery utilization rates dipped to 88.6% from 89.1% a week earlier, reflecting softer demand amid stable refining activity.
Crude prices slipped following the release, with West Texas Intermediate futures down 0.7% at $78.45 per barrel in electronic trading. Brent crude futures were 0.6% lower at $82.70 per barrel. The declines extended losses from Monday, when prices fell on concerns over demand growth in China and a stronger U.S. dollar.
The Energy Information Administration is scheduled to release its official inventory report on Wednesday at 10:30 a.m. ET, which will provide further clarity on market trends. The API data often diverges from government figures, but surprises in either report can trigger short-term price volatility.
Analysts attributed the crude build to higher-than-expected imports and weaker refining runs, though the precise drivers will be clarified in the EIA’s report. The unexpected stockpile rise adds to recent headwinds for oil markets, including elevated global supply and cautious economic outlooks in key consuming regions.
The data comes as OPEC+ prepares for its next policy meeting in June, where the group is expected to assess the impact of its production cuts on market rebalancing. Traders will monitor the EIA report for signs of whether the inventory build was an anomaly or the start of a broader trend.
Sophie covers currency markets and central bank policy across Europe, with a focus on how rate decisions ripple through FX pairs. She has been tracking the ECB's policy path since the start of the current easing cycle.
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