Oil prices edge lower after surprise build in U.S. crude, gasoline stockpiles
Oil prices drop after data shows a surprise build in U.S. crude stocks. Investors are waiting for April U.S. inflation data.
Early trade on Wednesday saw oil prices fall after data from the industry showed that crude stockpiles in the United States had risen unexpectedly. Investors were awaiting U.S. data on inflation for April, which could provide direction for Federal Reserve's rate decision.
Brent crude fell 16 cents a barrel to $77.28 at 0008 GMT. U.S. West Texas Intermediate crude (WTI), however, dropped 20 cents a barrel to $73.51. This wiped out gains made in the previous session.
According to sources, the American Petroleum Institute said that the rise in crude oil inventories could be a sign of a weakening market. The stockpiles of gasoline also increased by 399,000 barrels during the week ending May 5.
Eight analysts polled for Reuters had predicted a 900 000 barrel drop in crude stocks and a 1.2 millions barrel drop in gasoline stock.
The U.S. government is expected to release data on its oil inventory on Wednesday.
The market awaits the release of the U.S. Consumer Price Index for April on Wednesday.
John Williams, the New York Fed president, said that inflation is still too high. The central bank would raise rates again in the event of a need to do so.
The wildfires in Alberta, Canada's largest oil-producing province slowed down on Tuesday due to the cooler weather. Wildfires forced oil producers to stop at least 319,000 barrels per day of oil equivalent, or 3.7% the country's total production.