West Texas Intermediate declined for the first time in four days after an industry report showed fuel inventories rose in the U.S., the world’s biggest oil consumer. Brent crude fell from the highest close since April.
Futures slid as much as 0.9 percent after advancing 3.3 percent in the previous three days. Gasoline stockpiles climbed by 1.7 million barrels, while distillate supplies gained 1.1 million, data from the American Petroleum Institute showed yesterday, according to two people familiar with the matter. The Energy Department is scheduled to release its report today.
“Product inventories are starting to gain as seasonal demand eases,” said Andrey Kryuchenkov, an analyst at VTB Capital in London, who predicts WTI will trade in a range of $102 to $108 a barrel this month.
WTI for September delivery dropped as much as 91 cents to $105.92 a barrel on the New York Mercantile Exchange and was at $106.12 as of 12:15 p.m. London time. The volume of all futures traded was 24 percent below the 100-day average.
Brent for September settlement, which expires tomorrow, declined as much as 77 cents to $109.05 a barrel on the London-based ICE Futures Europe exchange. It closed at $109.82 yesterday, the highest since April 2. The more actively traded October contract lost 57 cents to $107.91 today. The European benchmark crude was at a premium of $3.06 to WTI.
U.S. crude inventories shrank by 999,000 barrels in the week ended Aug. 9, the API reported, said the two people who asked not to be identified because the information wasn’t publicly distributed. Stockpiles probably decreased by 1.5 million barrels, according to the median estimate of 11 analysts surveyed by Bloomberg News before today’s report from the Energy Information Administration, the Energy Department’s statistical unit. Gasoline supplies fell by 1.6 million barrels and distillates increased by 1 million, the survey showed.
“The market has overheated and we’re seeing some pullback,” said Victor Shum, a vice president at IHS Energy Insight, a consultant in Singapore. “As we move out of the peak demand season, the markets may be headed for a correction.”
The API in Washington collects stockpile information on a voluntary basis from operators of refineries, bulk terminals and pipelines. The government requires that reports be filed with the EIA for its weekly survey.
WTI has technical support along its 30-day middle Bollinger Band, at about $105.50 a barrel today, according to data compiled by Bloomberg. Front-month futures rose the past three days after trading near this indicator. Buy orders tend to be clustered around chart-support levels.
Libya’s Mellitah port may restart today following the resumption of the El Feel, or Elephant, field, according to Oil Minister Abdulbari Al-Arusi. The country is pumping about 650,000 barrels a day, while among its export terminals, only Zawiya, with a capacity of 300,000 barrels a day, is in operation, he said in Tripoli yesterday.
Crude production in Libya, the OPEC member that holds Africa’s largest oil reserves, has fallen to less than half the level pumped before the 2011 uprising against Muammar Qaddafi, amid a labor dispute that started in July.