Brent oil edges up ahead of US stocks data

21/07/2016 05:30 AST

Brent oil prices edged higher on Wednesday in muted trading as investors awaited a clearer signal from weekly US crude inventory data on whether a glut was easing in the world’s largest oil-consuming nation.

Global benchmark Brent crude prices were up 5 cents at $46.71 a barrel at 1225 GMT. On Tuesday, the contract settled down 30 cents, or 0.6 per cent.

In thin trading, US West Texas Intermediate (WTI) crude was down 13 cents at $44.52 a barrel. It fell 59 cents, or 1.3 per cent, in the previous session.

The front-month August contract will expire at the end of Wednesday’s session, meaning trading interest was low. “It’s a continuation of directionless trade. We need more clarity on where the oil market is heading,” said Carsten Fritsch, commodities analyst at Commerzbank.

The US government’s Energy Information Administration (EIA) will issue stockpile data at 1430 GMT. If the EIA confirms a drawdown, it will be the ninth straight week in which US crude stockpiles have fallen.

“Unless the weekly report can show some larger stock changes we expect a low-volume environment to continue tomorrow and Friday,” said Olivier Jakob, oil analyst at Petromatrix. The American Petroleum Institute, an industry group, reported on Tuesday that crude stockpiles fell by 2.3 million barrels last week.

That was just above a 2.1-million-barrel draw forecast in a Reuters poll. For distillate inventories including diesel, API reported a surprise draw of 484,000 barrels. But it also showed an unexpected gasoline build of 805,000 barrels.

Some bearish news capped gains on Wednesday as Russia’s energy minister dashed any hope that the world’s biggest oil producers could coordinate on output to stem global oversupply.

He told Reuters in an interview that Russia was not discussing coordination with producer group OPEC and that Russian oil output would rise to 542-544 million tonnes this year, a 30-year high.

The Gulf Today