U.S. West Texas Intermediate and international-benchmark Brent crude oil futures posted a two-sided trading range this week with a slight bias to the downside as traders continued to assess the impact of crude oil demand.
The markets were underpinned by the prospect of additional production cuts from OPEC and its allies. However, gains were capped by rising U.S. inventories and uncertainty over the timing of the output cuts due to Russia’s hesitancy to participate in the new plan.
Crude oil markets started the week under pressure but then began to stabilize as sellers let up on speculation OPEC and its allies would provide some relief for producers.
Gains were capped on Wednesday after data from the U.S. Energy Information Administration (EIA) showed crude inventories rose by 3.4 million barrels during the week-ending January 31, higher than forecast. Traders were looking for a 3.0 million barrel build.
Gasoline inventories fell 100,000 barrels during the last week of January. Gasoline production in the seven days to January 31 averaged 9.9 million bpd, versus 9.2 million bpd a week earlier.
Distillate fuels fell 1.5 million barrels last week. Distillate fuel production last week averaged 5 million bpd, down from a week earlier.