Oil prices retreated from 2016 highs on Wednesday after the U.S. government reported U.S. crude stockpiles rose to a record high last week as expected by analysts, despite an industry group saying otherwise.
The Energy Information Administration (EIA) said crude inventories climbed 2 million barrels to all-time peak of 540.6 million barrels for the week ended April 22.
A Reuters poll of analysts had forecast a build of 2.4 million barrels for last week. But the American Petroleum Institute (API) surprised the market late Tuesday by reporting a drawdown of 1.1 million barrels. [EIA/S] [API/S]
The API data sent oil prices soaring to their highest levels for the year after Tuesday’s market settlement, with the rally extending in Wednesday’s session before the release of the EIA report.
“The build in crude oil inventories, even though expected by most analysts, has dashed the bullish hopes that were fostered by the unexpected draw reported yesterday by the API,” said David Thompson, executive vice-president at energy-specialized commodities broker Powerhouse in Washington.
Brent crude futures LCOc1 were up 30 cents, or 0.6 percent, at $46.04 a barrel by 11:24 a.m. EDT (1524 GMT), having hit a 2016 high of $47.05 earlier.
U.S. crude’s West Texas Intermediate futures CLc1 were up 10 cents at $44.14, turning negative briefly after the EIA report. Earlier, it hit its highest level for the year at $45.18.