Dubai: Oil prices nudged lower after a report showed rising US crude stockpiles, a reminder that the pandemic continues to have a damping impact on demand.
Futures in New York slipped 0.4% to erase Tuesday's 0.2% gain. The industry-funded American Petroleum Institute report showed oil inventories rose by 4.17 million barrels last week, according to people familiar. That would mark a second week of growing stockpiles if confirmed by government data on Thursday, underlining a still-fragile picture for consumption.
Earlier, OPEC+ said oil producing countries must be ready to act when the group gathers for its next full meeting in two weeks after a panel of ministers met this week. The group had been discussing postponing an output increase by three to six months. Yet, Saudi Energy Minister Prince Abdulaziz bin Salman said the market is too fluid to make a decision on the cuts now.
OPEC and its allies are grappling with a disjointed demand picture. In Asia, where consumption has recovered substantially from Covid-19, refiners have been snapping up barrels from the Middle East, U.S. and Russia. The structure of Oman futures on the Dubai Mercantile Exchange has surged into a bullish backwardation - indicating tight supplies - in recent days. Yet, in Europe and the U.S., a surge in coronavirus cases has led to tougher restrictions limiting movement and consumption.
