Crude prices fell on Thursday after official data showed a big increase in U.S. gasoline stocks, sparking concerns about demand weakening in the world’s biggest oil consumer as crude supplies around the world rise.
West Texas Intermediate dropped 43 cents, or 0.71% to $59.15 a barrel.
Brent crude fell 51 cents, or 0.8%, to $62.65 a barrel.
While crude oil stocks in the United States fell more than forecast by analysts, gasoline inventories jumped sharply, also against expectations, the U.S. Department of Energy said on Wednesday.
Oil inventories dropped by 3.5 million barrels last week to nearly 502 million barrels, and gasoline stocks increased by 4 million barrels, against expectations of a decline, to just over 230 million barrels, as refiners ramped up production before the summer driving season.
“Refiners may want to pull back on the run rate a bit to keep gasoline storage from challenging the all-time record,” said Bob Yawger, director of energy futures at Mizuho Securities.
At the same time, supply is rising across the world with Russian output increasing from average March levels in the first few days of April, traders said.
Iran may see some sanctions lifted and add to global supplies, with the United States and other powers holding talks on reviving a nuclear deal that almost stopped Iranian oil from coming to market.
Still, the International Monetary Fund said earlier this week the massive public spending deployed to combat the COVID-19 pandemic may increase global growth to 6% this year, a rate not achieved since the 1970s.
Higher economic growth would boost demand for oil and its products, helping to reduce stockpiles.
“A more positive macro backdrop is also likely to attract further investor interest in the sector,” ANZ Research said in a note, reiterating its view that Brent crude will reach $75 a barrel in the third quarter.29dk2902l