Oil dipped on
Thursday as rising fuel inventories and crude production in the United
States dragged on prices although ongoing supply cuts led by producer
group OPEC prevented the market from slumping further.
Brent crude futures were trading at $55.69 per barrel at 0751 GMT, down 6 cents from their last close. U.S. West Texas Intermediate (WTI) crude futures dropped 10 cents to $53.01 per barrel.
The Organization of the Petroleum Exporting Countries (OPEC) and other producers including Russia have agreed to cut output by almost 1.8 million barrels per day (bpd) during the first half of 2017, and estimates suggest compliance by OPEC is around 90 percent.
The production cuts are aimed at reining in a global fuel supply overhang that has dogged markets for over two years.
U.S. crude oil and gasoline inventories soared to record highs last week as refineries cut output and gasoline demand softened, the Energy Information Administration said on Wednesday.
Crude inventories rose 9.5 million barrels in the week ended Feb. 10, nearly three times more than analyst expectations, boosting commercial stocks to an all-time record at 518 million barrels.
Gasoline stocks rose 2.8 million barrels, compared with analyst expectations in a Reuters poll for a 752,000-barrel drop. That pushed inventories of the fuel to a record at 259 million barrels.
The bloated stocks come as U.S. crude oil production has risen 6.5 percent since mid-2016 to 8.98 million bpd.
Because of the conflicting price drivers of OPEC's cuts and rising U.S. inventories and production, analysts said that prices were largely moving sideways.
The Organization of the Petroleum Exporting Countries (OPEC) and other producers including Russia have agreed to cut output by almost 1.8 million barrels per day (bpd) during the first half of 2017, and estimates suggest compliance by OPEC is around 90 percent.
The production cuts are aimed at reining in a global fuel supply overhang that has dogged markets for over two years.
U.S. crude oil and gasoline inventories soared to record highs last week as refineries cut output and gasoline demand softened, the Energy Information Administration said on Wednesday.
Crude inventories rose 9.5 million barrels in the week ended Feb. 10, nearly three times more than analyst expectations, boosting commercial stocks to an all-time record at 518 million barrels.
Gasoline stocks rose 2.8 million barrels, compared with analyst expectations in a Reuters poll for a 752,000-barrel drop. That pushed inventories of the fuel to a record at 259 million barrels.
The bloated stocks come as U.S. crude oil production has risen 6.5 percent since mid-2016 to 8.98 million bpd.
Because of the conflicting price drivers of OPEC's cuts and rising U.S. inventories and production, analysts said that prices were largely moving sideways.
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