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New York, US (BBN) – Crude oil held weaker in Asia on Thursday after a surprise rise in US inventories and as markets await the tone of summit talks with Chinese President Xi Jinping on starting later in the day in Florida.
On the New York Mercantile Exchange crude futures for April eased 0.55 per cent to $50.87 a barrel, while on London’s Intercontinental Exchange, Brent was down 0.52% at $54.08 a barrel, reports investing.com.
Overnight, crude futures settled higher on Wednesday, but pulled back sharply from one-month highs, after the latest Energy Information Administration (EIA) report showed an unexpected rise in US crude inventories to a record high.
Oil prices retreated from one-month highs, as fears returned that a ramp up in US oil production could prove a challenge to an OPEC-led deal aimed at tackling the oversupply issue in the industry.
For the week ending March 29, The EIA said that crude oil inventories rose by 1.566 million barrels compared to estimates of a draw of 0.435 million barrels.
Gasoline inventories dipped by 0.618 million against expectations for a drop of 1.422 million barrels while distillate stockpiles fell by 0.536 million barrels, compared to expectations of a 1.016 million decline.
The surprise build in US crude stockpiles confounded expectations that US demand for oil would start to pick up ahead of the ‘summer driving season’.
The Energy Information Administration (EIA) says that gasoline demand is typically about a million barrels per day higher at its summer peak than at its low point for the year, which is generally in January.
Meanwhile, market participants turn attention to Baker Hughes rig count, due to be released on Friday at 13:00 EDT.
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