Oil futures fall after DoE data reveal smaller than expected inventory drop

Crude oil inventories Stateside fell by less than expected last week, pushing crude oil futures over the edge.

Commercial oil stockpiles Stateside fell by 2.5m barrels a day during the week ending on 8 July, the Energy Information Administration, the US Department of Energy's statistical arm, reported.

Analysts at S&P Global Platts expected supply to fall by 3.25m barrels following the 2.2m barrel climb the previous month.

The news sent Brent crude 4.28% lower to $46.48 per barrel on the ICE, while West Texas Intermediate fell 3.9% to $45.01 per barrel at 1715 BST.

According to the report from the EIA, US crude oil inventories were at historically high levels for that time of year, at 521.8m barrels.

Data from the American Petroleum Institute published on Tuesday was also weighing on crude oil futures, after it showed US crude inventories rose by 2.2m barrels in the week to July 8 to 523.1m, versus analysts' expectations for a 3m barrel drop.

Nigerian supplies recover, IEA says

Adding to the selling pressure, global oil supplies rose by 0.6 mb/d in June to 96 mb/d, according to a report by the International Energy Agency (IEA) which was also released on Wednesday - partly as a result of recovering oil supplies in Nigeria.

That came after outages curbed OPEC and non-OPEC supplies in May.

In OPEC countries, crude output rose by 400 kb/d in June to an eight-year high of 33.21 mb/d, including newly re-joined Gabon.

Saudi Arabia’s supply rose to a near-record rate of 10.45 mb/d and Nigerian flows partially recovered. Middle East producers sustained record pumping rates, consolidating market share and pushing OPEC’s total output 510 kb/d above one year ago.