Oil Falls as US Stocks Rise

Oil prices fell on Wednesday as an unexpected build in crude and fuel inventories in the United States, the world's biggest oil consumer, and economic uncertainty reignited demand worries.
US West Texas Intermediate crude futures slipped by 54 cents, or 0.72%, to $74.58 a barrel, while Brent crude futures fell by 50 cents, or 0.62%, to $79.60, Money.usnews.com reported.
Both contracts rose on Monday and Tuesday, rebounding from a sharp selloff in the first week of 2023.
US crude oil stockpiles jumped by 14.9 million barrels in the week ended Jan. 6, sources said, citing data from the American Petroleum Institute. At the same time, distillate stocks, which include heating oil and jet fuel, rose by about 1.1 million barrels.
Analysts polled by Reuters had expected crude stocks to fall by 2.2 million barrels and distillate stocks to drop by 500,000 barrels.
The large increase in US inventories in the API estimates has dragged down oil prices, while the risk of recession is also capping the oil price uptrend in the short run, said analyst Leon Li at CMC Markets.
Traders will be looking out for inventory data from the US Energy Information Administration due later on Wednesday to see if it matches the preliminary view from API.
The oil market has been pulled lower by worries that sharply higher interest rate hikes to tame inflation would trigger a recession and curtail fuel demand.