WTI futures dip on staggering US oil inventory build

Oil futures slipped on news that US stockpiles rocketed during the previous week.

According to data from the American Petroleum Institute released on Tuesday, crude oil inventories in the States increased by 14.2m barrels over the latest reference week.

"The staggering increase comes as OPEC and non-OPEC producers are attempting to wrestle with the market oversupply and drive prices back towards more sustainable levels. The problem these producers are now facing is that their efforts have been so successful that US shale producers that were previously priced out are now returning in large numbers.

"This is preventing oil getting back above $60 a barrel and instead, we’re now seeing its trading back around the lows of the range it’s held in since the start of December. The sell-off since API reported its numbers on Tuesday has been quite substantial and should EIA (set for release later on Wednesday) confirm its analysis, we could see the lower end of the ranges come under serious pressure," said Craig Erlam, senior market analyst at Oanda.

As of 1131 GMT front month West Texas Intermediate futures were down by 0.675% to $51.82 a barrel on the ICE.