Oil Trading Lower as EIA Report Show Unexpected Rise in U.S. Inventories

Oil prices fell on Wednesday, following the release of the weekly inventories report from the United States Energy Information Administration (EIA).

Data by the EIA showed an increase in U.S. crude stockpile, which prompted a decline in oil prices to their lowest level in roughly three weeks, despite the decline of the U.S. Dollar (USD) against major peers.

The U.S. crude oil inventories increased by 1.3 million barrels for the week ended May 14, rising for the first time in three weeks against market expectations.

Gasoline stockpiles dropped 2 million barrels, while distillate inventories decreased by 2.3 million barrels.

The resurgence of the coronavirus pandemic in India, the world’s third-largest importer of crude oil, amid a new wave that saw huge increases in the number of cases, as well as the continuous negotiations regarding the Iran nuclear deal, which might lead to lifting sanctions, are weighing down on oil prices.

Brent crude futures for June delivery are trading lower by 2.79% at $66.79 a barrel.

Meanwhile, the West Texas Intermediate (WTI) June contracts are down by 3% at $63.52 per barrel.