Oil Retreats After API Reports Increase in Crude Oil Supply
-Oil was down on Wednesday after the American Petroleum Institute (API) predicted a second consecutive week of increases in the crude oil supply.
API reported a 3.9 million-barrel build for the week ending June 12 on Tuesday.
Both benchmarks gave up some of their gains from the previous session, where Brent futures rose 3% and WTI futures rose 3.39% after the International Energy Agency upped its forecast for 2020 oil demand to 91.7 million bpd, and the U.S. saw a record jump in May retail sales.
But the black liquid retreated after the API forecast amid renewed oversupply supplies.
Investor sentiment was further damped with a rising second wave of cases in Beijing and parts of the U.S. threatening the already-fragile demand
“It seems unavoidable there may be small spikes and isolated outbreaks throughout the world. It may take time for the oil market to desensitize, given the nascent recovery’s fragility,” Stephen Innes, chief global market strategist at AxiCorp, told Reuters.
Meanwhile, all eyes will be on the U.S. Energy Information Administration supply forecast due later in the day, as well as on the results of the OPEC-led monitoring panel on Thursday.
The panel will review compliance with OPEC’s pledged production cuts, in place until the end of July, and look at ways to support prices.