U.S. crude stocks build unexpectedly as imports jump, output climbs

U.S. crude stocks build unexpectedly as imports jump, output climbs

"The components of the report relating to crude oil were bearish", said John Kilduff, partner at Again Capital LLC in NY.

USA crude futures for December delivery extended losses after the data to fall 64 cents to $56.56 a barrel by 10:55 a.m. EST (1555 GMT). Prices extended earlier losses in the immediate wake of the supply data, but also briefly traded at a high close to $57.90 about two hours after it, before falling again. Distillate inventories were also trimmed by about 3.4m barrels, well in excess of expectations for a 1.4m barrel draw.

January Brent crude lost 45 cents, or 0.7%, to $63.23 a barrel on the ICE Futures Europe exchange, with prices also seeing volatile trade.

During the week ending on 3 November, total United States commercial crude inventories rose by 2.2m barrels (consensus: 2.9m) versus the prior week to reach 457.1m barrels, according to the Energy Information Administration.

The EIA also said crude stocks increased by 2.2 million barrels, shocking the market after analysts polled by Reuters had forecast a 2.9 million-barrel draw and industry group the American Petroleum Institute on Tuesday reported a decline of 1.6 million barrel. Unlike the API, Bloomberg's survey forecast a decline in gasoline supplies of 1.85 million barrels.

Gasoline stockpiles fell 3.3 million barrels to 209.5 million barrels, while analysts in the survey were expecting levels to fall by 1.8 million barrels from the previous week.

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Analysts in a Reuters poll had expected a 1.9 million-barrel drop.

December natural gas also climbed by 2.9 cents, or 0.9%, to $3.181 per million British thermal units. "But record levels of oil production will delay the wider oil market rebalancing", said Thomas Pugh at Capital Economics.

The EIA data also showed a 290,000 barrels per day increase in United States refinery crude runs, to 16.31m barrels per day in total.

Oil stored at Cushing, Oklahoma, the delivery point for U.S. stocks, increased by 720,000 barrels to 64.6 million barrels, the EIA said in its weekly report. Recent political upheaval in Saudi Arabia has added to price gains.

"At the end of the day, with the rise in USA production and build [at the Cushing, Okla., trading hub], we. wouldn't be surprised to see a further pullback in the days to come" barring any new geopolitical news out of Saudi Arabia, said Zahir. "Sharp declines" were seen in Iraq and Nigeria.