Oil prices were mixed on Wednesday, dampened by reports of rising U.S. crude stockpiles but retaining some of the gains made in the previous session after OPEC said it expected higher demand for its crude next year.
U.S. West Texas Intermediate (WTI) was unchanged at $48.23 a barrel at around 0359 GMT after rising earlier in the day. The contract rose 0.3 percent on Tuesday.
International benchmark Brent crude was down 13 cents, or 0.2 percent, at $54.14 a barrel, having settled up 0.8 percent in the previous session.
The difference between Brent and WTI, known as the spread, rose by 11 cents to $5.41 in the favor of the global benchmark, as Hurricanes Harvey and Irma continued to impact demand for both crude and oil products in the U.S.
“The market is still trying to assess…the positioning on Brent and the positioning on WTIE and that’s reflected in the price spread,” said Virendra Chauhan, oil analyst at Energy Aspects in Singapore.
Wednesday’s drop came after a rise the day before when the Organization of Petroleum Exporting Countries (OPEC) forecast higher demand for its oil in 2018 and pointed to signs of a tighter global market, indicating its production-cutting deal with non-member countries is helping to tackle a supply glut that has weighed on prices.
Analysts have warned current U.S. stocks data may not give a full picture in coming weeks because of weather disruption, but industry group the American Petroleum Institute reported late on Tuesday that U.S. crude stockpiles rose nearly twice expected levels last week. Refineries cut output following Hurricane Harvey, while gasoline and distillate inventories fell.
Crude inventories rose by 6.2 million barrels in the week to Sept. 8 to 468.8 million, nearly double analysts’ expectations of an increase of 3.2 million barrels.
The U.S. Department of Energy’s Energy Information Administration (EIA)reports on stockpiles and refinery runs later on Wednesday.
The EIA also said on Tuesday it had revised both its 2017 and 2018 oil production forecast figures lower to reflect, in part, the effects of Hurricane Harvey.
The largest refinery in the United States, in Port Arthur Texas, was running at reduced rates, sources told Reuters.