Crude fell in Asian trade on Wednesday as investors weighed in the impact of a jump in US oil stockpiles, analysts said.
New York’s main contract, light sweet crude for delivery in May, lost 55 cents to $104.24 per barrel while Brent North Sea crude for May dipped 21 cents to $114.95.
The American Petroleum Institute (API), an industry body, said Tuesday crude inventories rose by 5.7 million barrels last week with the increase seen as an indication of sluggish US demand. The US is the world’s biggest oil consumer.
“Yesterday itself, API reported that crude oil inventories gained by 5.7 million barrels last week, and prices declined as investors considered the crude oil stockpiles increase,” said Ong Yi Ling, investment analyst for Phillip Futures in Singapore.
The unrest in Libya and the region along with a weekly US Department of Energy inventory report due later Wednesday will be keenly watched by traders, Ong told AFP.
At an international summit on Libya in London on Tuesday, British Foreign Minister William Hague said that Qatar had agreed to arrange the sale of Libyan oil.
Commerzbank analysts said that “the hopes of Libyan oil shipments normalising soon are exaggerated.”
They noted the security situation in Libya remained tense, “which is making it difficult for oil workers to return to production sites.”
Oil-rich Libya was producing 1.69 million barrels a day before the unrest, according to the International Energy Agency. It is now producing 400,000 barrels a day.