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Crude oil futures fell for a third straight session Wednesday, with prices dropping to their lowest in three weeks, as another increase in U.S. commercial inventories and weaker economic data from China outweighed Middle East tensions.
The Energy Information Administration reported a fourth straight weekly build in U.S. commercial crude inventories, up by a higher than expected 2.7M barrels for the week ended April 12, while the report also showed larger than forecast weekly supply declines of 1.2M barrels for gasoline and 2.8M barrels for distillates.
Motor gasoline product supplied – considered a proxy for demand – averaged 8.8M bbl/day for the four weeks ending April 12, the lowest for this time of year since 2022, according to DTN analyst Troy Vincent.
“Demand worries are back in the oil pits as traders shed the potential Israeli-Iran counter attack,” Spartan Capital’s Peter Cardillo said.
Front-month Nymex crude (CL1:COM) for May delivery closed -3.1% to $82.69/bbl, and front-month June Brent crude (CO1:COM) ended -3.0% to $87.29/bbl, its worst one-day percentage loss since January 8 for both benchmarks.
ETFs: (NYSEARCA:USO), (BNO), (UCO), (SCO), (USL), (DBO), (DRIP), (GUSH), (NRGU), (USOI)
In China, the world’s biggest oil importer, the economy grew by a stronger than expected 5.3% during Q1, but other indicators pointed to lackluster demand.
China’s industrial output in March improved 4.5% Y/Y, well below the 6.0% forecast and the 7.0% gain for the January-February period, and March retail sales rose 3.1% Y/Y, missing the 4.6% growth forecast and slowing from a 5.5% gain in the January-February period.
