Oil prices have fallen after a report released by the American Petroleum Institute (API) showed an unexpected build in US crude stockpiles.
Brent crude futures dipped $0.38 to $65.72 a barrel, while West Texas Intermediate (WTI) crude futures reduced by $0.46 to $60.48 per barrel, reported Reuters.
The report released by the API showed that the US crude stockpiles rose 4.7 million barrels to 452 million during the week that ended on 13 December, when compared with analysts’ expectations for a drop of 1.3 million barrels.
Before the phase one trade agreement between the US and China, oil markets were concerned about the global economic impact between the two countries.
AxiTrader market strategist Stephen Innes was quoted by the news agency as saying: “The sizzling oil market rally came to a grinding halt after an unexpected climb in the weekly US crude inventory report.
“Investors have transcended the trade deal-inspired relief rally euphoria, and are now banking on a fundamental demand-driven shift that could quicken the pace of the oil market rebalancing in the first quarter of 2020.”
Meanwhile, data from the US Energy Information Administration (EIA) is yet to be released later today.
Deeper production output curbs from the Organization of the Petroleum Exporting Countries and its allies, collectively known as OPEC+, also continued to support the market sentiment by preventing an additional slide in prices.
OPEC+ has agreed to cut production by 1.2 million barrels per day (Mbpd) since this January.
It will further cut 500,000bpd from January next year to support the market.