West Texas Intermediate (WTI) oil edged higher in European trade on Wednesday, as investors anticipated the release of U.S. crude inventory data which is due later in the day. Market players expect it to reveal a slower than expected rise from last week’s numbers.
The U.S. Energy Information Administration’s weekly report on oil inventory will be made public at around 10:30AM ET. Analysts and investors alike are expecting a gain of about 3.2 million barrels.
On Tuesday, industry group American Petroleum Institute (API) noted that U.S. oil inventories declined by 4.3 million barrels in the week leading to April 1. Market players were expecting a rise of 2.9 million barrels.
Crude stockpiles at WTI’s delivery hub in Cushing, Oklahoma added 62,000 barrels, the API reported, while distillate inventories rose by 2.7 million barrels. Gasoline stocks fell by 116,000 barrels.
Crude oil prices for May delivery in New York tacked on $0.89, or 2.48%, to trade higher at $36.78 a barrel by 2:57AM ET.
On Tuesday, New York-traded oil closed $0.19, or 0.53% higher at $35.89, but not before falling to a daily low of $35.24.
In London, Brent oil for June delivery added $0.61, or 1.61%, to trade higher at $38.48 a barrel.
On Tuesday, London-traded Brent futures plunged to an intraday low of $37.27, the lowest since March 4, before going back up to close at $37.87, up $0.18, or 0.48%.
Investors dialed back on their bullish oil bets this week after Saudi Deputy Crown Prince Mohammed bin Salman said that the kingdom will not limit output unless Iran and other major producers were on board.
Iran has repeatedly announced that it will not participate in the collective output freeze until its crude exports are back to pre-sanction levels of around 4 million barrels per day.
Meanwhile, Brent’s premium to the WTI crude contract went down to $1.70 a barrel, compared to Tuesday’s gap of $1.98.