The American Petroleum Institute (API) estimated on Wednesday a surprise crude oil inventory build of 1.57 million barrels for the week ending January 17, compared to analyst expectations of a 1.009-million-barrel draw in inventory.
Last week saw a build in crude oil inventories of 1.1 million barrels, according to API data. The EIA's estimates, however, were of a draw of 2.5 million barrels for that week.
Oil prices were down earlier in the day prior to the afternoon data release, despite continued unrest in oil-rich Iraq and a near-complete oil production disruption in Libya, as fears of economic slowdown once again surface-this time not from the trade dispute between the United States and China, but due to a deadly SARS-like virus known as coronavirus in China that now shows a confirmed case in the United States.
At 2:24 pm EST on Wednesday, the WTI benchmark was trading down $1.34 (-2.30%) at $57.04, roughly $1.30 per barrel under last week's levels. The price of a Brent barrel was also trading down on Wednesday, by $1.11 (-1.72%), at $63.48-roughly $1.10 under last week's prices.
The API this week also reported another large build of 4.5 million barrels of gasoline for week ending January 17, after last week's large 3.2-million-barrel build. This week's large gasoline build compares to analyst expectations of a 3.090-million barrel-build for the week.
Distillate, too, saw inventories increase, by 3.5 million barrels for the week, adding onto last week's large 6.8-million-barrel build, while Cushing inventories fell by 429,000 barrels.
US crude oil production as estimated by the Energy Information Administration showed that production for the week ending January 10 increased to 13.0 million bpd, a record high for the United States.
At 4:43 pm EDT, WTI was trading at $56.60, while Brent was trading at $63.07.
By Julianne Geiger for Oilprice.com
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Julianne Geiger is a veteran editor, writer and researcher for Oilprice.com, and a member of the Creative Professionals Networking Group. More