Oil futures saw choppy trade Wednesday after data showed a larger-than-expected jump in U.S. crude inventories.
The Energy Information Administration said crude inventories rose 7.2 million barrels to 449.5 million barrels in the week ended March 29, leaving them at the five-year average. Analysts surveyed by S&P Global Platts had produced a consensus forecast for a drop of 100,000 barrels. However, the American Petroleum Institute late Tuesday had reported a 3 million barrel rise in inventories, sources said.
West Texas Intermediate crude for May delivery CLK9, +1.87% on the New York Mercantile Exchange was down 34 cents, or 0.5%, at $62.24 a barrel. It had fallen 51 cents to trade at a session low of $62.07 immediately after the data then pushed back into positive territory before drifting back into negative territory. It closed Tuesday at $62.58 — its highest finish since Nov. 5.
Oil traders had played down the inventory data by, in part, focusing on a statistical adjustment that accounted for a large chunk of the increase, said Robert Yawger, director of energy at Mizuho Securities.
Yawger said the market’s ability to rebound in the aftermath of the data showed that upside momentum remains intact, with traders using “any excuse they can to grasp for the upside.”
Bulls had previously found encouragement in recent signs of tightening supplies and fading worries over global economic growth. The demand picture also was bolstered as U.S. stocks gained Wednesday, as did most risk-on markets, a reflection of cautious confidence for late-innings progressin U.S.-China trade negotiations.