Oil prices fell on Wednesday as industry data pointed to a big build in crude oil and distillate stocks in the United States, the world’s largest oil consumer, and as pressure mounted on OPEC to increase supply.
Brent crude futures were down $1.81, or 2.14%, at $82.91 a barrel at 1118 GMT. US West Texas Intermediate (WTI) crude futures tumbled $2.01, or 2.40%, to $81.90 a barrel.
“Crude prices are declining after the API reported the sixth straight week of crude oil inventory builds and as the Biden administration exhausts every possible plea to OPEC+ members before tapping their Strategic Petroleum Reserve,” said Edward Moya, senior analyst at OANDA.
President Joe Biden, speaking at a climate summit in Glasgow, blamed a surge in oil and gas prices on a refusal by OPEC nations to pump more crude.
The Organisation of the Petroleum Exporting Countries and its allies, a group known as OPEC+, meets on Thursday to review its policy and is expected to reconfirm plans for steady monthly increases despite calls for a raise.
“The producer group is expected to maintain its 400,000 barrel per day monthly supply increases. This, in turn, should preserve this quarter’s supply deficit,” said Stephen Brennock of broker PVM.
US crude and distillate fuel stocks rose last week while gasoline declined, according to market sources citing American Petroleum Institute figures on Tuesday.
Crude stocks rose by 3.6 million barrels in the week ended October 29. Gasoline inventories fell by 552,000 barrels and distillate stocks rose by 573,000 barrels, the data showed, according to the sources, who spoke on condition of anonymity.
Data from the US Energy Information Administration, the statistical arm of the US Department of Energy, will be released later on Wednesday.
In a sign that high prices are encouraging more supply elsewhere, BP said on Tuesday it would ramp up investments in its onshore US shale oil and gas business to $1.5 billion in 2022 from $1 billion this year.
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