Oil futures under pressure as Canadian output expected to start gradual recovery

Crude oil futures gave back some of the previous day's gains following reports that Canadian oil sands firms were already looking to start production, even as the wildfires in Alberta continued to rage.

Oil facilities around the area of Fort McMurray were expected to come back on-line in just a matter of days, according to provincial and industry officials, Reuters reported.

By some estimates, the risk to workers and their families as well as the installations due to the wildfires had forced approximately 1.5m barrels per day of oil output offline.

The news from Canada came after a sharp move higher in oil futures during the previous session, amid reports of heightened risks to output from Libya and Nigeria.

On 10 May, Libya's National Oil Corp. said fields accounting for the majority of the country's output could be forced to stop pumping oil unless a blockade of the port of Marsa el-Hariga was lifted.

To take note of, one of the Mediterranean country's highest ranking oil officials warned of the potential for permanent damage to the country's output due to the high wax content of the oil, which would solidify inside the pipelines if it were to stop flowing.

Later that same day, Royal Dutch Shell and Chevron reportedly evacuated workers from the Niger Delta due to heightened security risks in that key oil-producing region.

Approximately 90,000 barrels a day of oil production were brought off-line in the previous week due to an attack on an offshore oil platform.

The latest weekly inventory data from the American Petroleum Institute, released on the previous evening, revealed a 3.45m barrel build in US oil inventories and were thus likely also weighing on sentiment in the oil patch.

Traders were waiting on similar inventory numbers scheduled for release by the Energy Information Administration, the Department of Energy's statistical arm, later on Wednesday, at 15:30 BST.