Oil prices declined on Thursday following a surprise build in US gasoline inventories, fueling investor jitters over low demand.
International benchmark Brent crude was trading at $62.67 per barrel at 0714 GMT for a 0.77% decrease after closing Wednesday at $63.16 a barrel.
American benchmark West Texas Intermediate (WTI) was at $59.26 per barrel at the same time for a 0.85% fall after it ended the previous session at $59.77 a barrel.
Oil prices came under pressure after the US Energy Information Administration (EIA) announced Wednesday that the country’s gasoline inventories rose by 4 million barrels, or 1.8%, during the week ending April 2.
Crude oil inventories, however, decreased by 3.5 million barrels, or 0.7%, for the same period.
Signaling low demand, the unexpected build in gasoline inventories came after major oil producers of OPEC+ decided to increase their output after April. The group’s production will increase by 2.1 million barrels per day (bpd) until the end of July, easing the current production cut of 7.9 million bpd.
Not included in OPEC+’s production cut deal, Iran, however, may start production if intensified diplomatic efforts to return the US to the landmark nuclear accord end with a positive resolution. This would lift the Trump-era sanctions on Iran.
Senior officials of Iran, France, the UK, Germany, Russia, China, and the EU are meeting in Vienna for ongoing negotiations.
A US delegation was also in the Austrian capital on Tuesday in a bid to save the accord, but the team headed by Special Envoy Robert Malley did not participate in the meeting with other world powers, as Iran refuses to directly negotiate with the US until so-called “maximum pressure” sanctions are lifted.
The EIA’s positive projection in its April Short-Term Energy Outlook on Tuesday limited further oil price declines.
The agency revised up its forecast for global crude oil prices from $60.67 a barrel to $62.28 per barrel for 2021 due to “somewhat tighter markets in the second quarter.”
By Sibel Morrow