Oil Inventories Unexpectedly Rise by 1.026M Barrels Last Week: API

(C) Reuters.

By Yasin Ebrahim

Investing.com – U.S. oil stockpiles unexpectedly rose last week despite a cold snap sweeping across Texas that shut in production across the oil-rich state and left millions without power.

U.S. crude inventories rose 1.026 million barrels last week, according to an estimate released Tuesday by the American Petroleum Institute, after a fall of 5.8 million barrels the previous week. Still, the unexpected build was hardly surprising according to some market participants in the wake of a refinery capacity that was down.

Cushing inventory slipped by 2.738 million barrels, while gasoline inventories fell by 66,000 barrels, and distillate stocks decreased by 4.49 million barrels.

Crude Oil WTI Futures, the U.S. benchmark for oil, fell 42 cents a barrel after settling down 3 cents, at $61.67 per barrel.

Oil prices made a strong start to the week on Monday after Goldman Sachs hiked its price target on Brent crude oil to $70 in the second quarter and $75 in the third, from prior forecasts of $60 and $65 respectively, citing expectations for tight oil markets this summer.

“We now forecast that oil prices will rally sooner and higher, driven by lower expected inventories and higher marginal costs — at least in the short run — to restart upstream activity,” Goldman said in a note.

The official government report due Thursday is expected to show weekly U.S. crude supplies declined by about 5.190 million barrels last week.