Crude oil prices saw a minor increase today when the U.S. Energy Information Administration reported an oil inventory build of 500,000 barrels for the week to January 20.
The latest change in inventories compared with two sizeable weekly builds-one of 8.4 million barrels for the second week of January and a 19-million-barrel one for the first week of the month.
At 448.5 million barrels, crude oil inventories in the United States are 3 percent above the five-year average for this time of year.
Fuels, meanwhile, showed mixed directions in inventory changes.
In gasoline, the EIA estimated an inventory increase of 1.8 million barrels for the week to January 20, which compared with a build of 3.5 million barrels for the previous week.
Gasoline production averaged 8.8 million barrels daily last week, which compared with 8.9 million barrels daily for the previous week.
In middle distillates, the EIA estimated an inventory draw of 500,000 barrels for the week to January 20, which compared with a draw of 1.9 million barrels for the previous week.
Middle distillate production last week declined slightly from 4.6 million bpd for the previous week.
Crude oil prices, meanwhile, rose to the highest in seven weeks earlier this week before deflating somewhat, as traders took profit. On Monday, Brent crude hit $89 per barrel before retreating, suggesting expectations of a quick Chinese demand rebound remain strong.
At the same time, worry about the immediate prospects of the global economy remains just as strong, it appears. On Tuesday, oil prices shed 2 percent after the release of the latest economic data from the United States, which showed business activity had shrunk in January-the seventh month of contractions in a row.
JP Morgan fueled the cautious sentiment towards oil prices with a note, in which it said it expected a quick Chinese demand rebound but added that Brent is unlikely to breach $100 per barrel again.
On the other hand, Aramco's chief executive has predicted danger of oil shortages as demand rises faster than supply, and so has the International Energy Agency, forecasting a gap of some 900,000 bpd between demand and supply.
By Irina Slav for Oilprice.com
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Irina is a writer for Oilprice.com with over a decade of experience writing on the oil and gas industry. More