Oil Drops on Surprise Inventories Increase

Oil prices fell on Wednesday on signs Saudi Arabia and other big producers may increase production, and U.S. crude slid more than 1 percent on a surprise build in domestic crude stockpiles.

U.S. crude inventories rose 2.1 million barrels in the week to June 1, the Energy Information Administration said, a surprise after analysts had forecast a decrease of 1.8 million barrels. Fuel inventories also rose.

EIA also said U.S. crude output hit a record of 10.8 million barrels a day in the week. Rising production has prompted selling since global benchmark Brent LCOc1 climbed above $80 a barrel last month.

Reuters

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Craig Erlam

Craig Erlam

Senior Currency Analyst at OANDA
Based in London, England, Craig Erlam joined OANDA in 2015 as a Market Analyst. With more than five years' experience as a financial market analyst and trader, he focuses on both fundamental and technical analysis while conducting macroeconomic commentary. He has been published by The Financial Times, Reuters, the Wall Street Journal and The Telegraph, and he also appears regularly as a guest commentator on networks including Sky News, Bloomberg, CNBC and BBC. Craig holds a full membership to the Society of Technical Analysts and he is recognized as a Certified Financial Technician by the International Federation of Technical Analysts.