Oil Prices Hold Onto Early Gains Despite Bigger-Than-Expected Build in US Stockpiles

12:13 PM, Feb 1, 2017 — Oil prices remained in positive territory on Wednesday afternoon despite government data showing that US inventories of crude oil had risen for a fourth consecutive week.

West Texas Intermediate (WTI) crude oil, the main US oil benchmark, was trading 0.6% higher at $53.10 per barrel recently while Brent crude, the international oil gauge, was 0.7% higher at $55.94 per barrel.

US inventories of oil rose by 6.5 million barrels to 494.8 million barrels in the week ended January 27, according to the Energy Information Administration’s (EIA) weekly oil report. This was more than the 5.8 million barrel weekly increase projected by the American Petroleum Institute (API) on Tuesday.

Total motor gasoline inventories increased by 3.9 million barrels, down from a 6.8 million barrel weekly gain in the previous week. Distillate fuel inventories increased by 1.6 million barrels compared to having been virtually unchanged in the prior week. Propane/propylene inventories fell by 5.6 million barrels, a bigger drop than the 4 million barrel fall registered in the prior week and commercial petroleum inventories increased by 5.3 million barrels, compared to an increase of 8.9 million barrels a week earlier.

Also feeding into oil pricing sentiment on Wednesday was a higher greenback. As a dollar denominated commodity, a higher US currency tends to make oil less affordable to international buyers. The Dollar Index, which tracks the value of the US currency, was 0.29% higher at the time of writing.

Price: 7.91 Price Change: +0.05 Percent Change: +0.64