Oil prices faced a downward trend on Thursday as U.S. crude inventories witnessed a substantial surge, raising concerns about demand in the world’s largest economy and primary oil consumer.
Brent crude oil, the international benchmark for Nigerian oil, fell by 38 cents or 0.5% to settle at $81.22 a barrel by 09:37 am, while U.S. West Texas Intermediate crude oil saw a decline of 43 cents, or 0.6% to close at $76.21 a barrel.
The Energy Information Administration (EIA) disclosed a notable increase in U.S. crude inventories, rising by 12 million barrels to 439.5 million barrels for the week ending February 9.
This exceeded analysts’ expectations, who had forecasted a rise of 2.6 million barrels.
The unexpected surge in stockpiles prompted apprehension among traders about the level of demand.
Analysts attributed the buildup in crude supplies to reduced refinery utilization rates, notably affected by the shutdown of BP’s Whiting plant in Indiana, with a daily capacity of 435,000 barrels.
Lower refinery run rates contributed to a decline in gasoline stocks despite the overall inventory surge.
Market analysts anticipate a significant response to the upcoming March meeting of the Organization of the Petroleum Exporting Countries (OPEC) and its allies (OPEC+), particularly regarding the decision on whether to extend output curbs.
