Oil prices dipped on Thursday after data showed U.S. crude stockpiles rose last week and the U.S. Energy Information Administration (EIA) downgraded its oil demand outlook, although the Brent benchmark stayed above $40 a barrel.
U.S. West Texas Intermediate (WTI) crude CLc1 futures dipped 61 cents to $37.44 a barrel at 0808 GMT, after climbing 3.5% on Wednesday.
Brent crude LCOc1 futures fell 53 cents to $40.26 a barrel, after rising 2.5% the previous day.
The EIA will release official weekly inventory data later on Thursday, a day later than normal following this week’s U.S. Labor Day holiday.
The EIA already cut its 2020 world oil demand growth forecast by 210,000 barrels per day to 8.32 million bpd.
Industry data from the American Petroleum Institute (API) showed on Wednesday the country’s crude stockpiles unexpectedly rose by 3 million barrels in the week to Sept. 4 with coronavirus cases rising in several U.S. states.
“If the EIA confirms a crude oil build later today, it would be the first U.S. stock build since mid-July,” ING analysts said.
On China’s oil imports which have supported oil in recent months, Bank ANZ said they were likely to level off as ‘teapot’, or independent refineries, reach their maximum annual crude import quotas.
In a further bearish sign, leading commodity traders are booking tankers to store crude oil and diesel on the water, with supply outpacing consumption, according to trading sources and shipping data.
The rising stockpiles come ahead of a meeting on Sept. 17 of the market monitoring panel of the Organization of the Petroleum Exporting Countries (OPEC) and allies including Russia, together known as OPEC+, which in August trimmed supply curbs from earlier this year on expectations demand would improve.
“Despite the recent slide in oil prices, we think that the OPEC+ leadership will continue to direct its efforts towards securing better compliance rather than pushing for deeper cuts at this stage,” RBC analysts said.