Early trading on Wednesday showed little movement in oil prices as industry data revealed an unexpected increase in U.S. crude and petrol inventories, allaying concerns about a supply shortage prior to OPEC producers cutting their output.
U.S. oil futures have shifted into backwardation, with the front-month contract trading 6 cents higher than the second month, signaling a tightening of the market. Brent crude was down 5 cents at $85.57 per barrel, while U.S. West Texan Intermediate was down 6 cents at $81.48.
In the week ending April 7, according to data from the American Petroleum Institute (API), crude stockpiles increased by around 380,000 barrels, contrary to expectations from eight analysts surveyed by Reuters expecting a fall of 600,000 barrels.
On Wednesday morning, the U.S. government will publish its stockpile numbers. Prices had increased by roughly 2% on Tuesday due to expectations that the Federal Reserve could loosen its monetary policy after the release of Wednesday’s consumer price data in the United States.
The International Monetary Fund issued a warning on Tuesday that potential crises in the financial system might harm this year’s global economic expansion, but it also urged member nations to continue tightening monetary policy to combat persistently high inflation.
Oil demand and supply predictions will be updated in the monthly reports from the Organization of the Petroleum Exporting Countries (OPEC) and the International Energy Agency, which are due on Thursday and Friday, respectively.
