WASHINGTON (dpa-AFX) - Oil prices fell on Wednesday despite data showing a larger than expected drop in crude inventories in the week ended November 29th, and prospects of supply disruptions due to the ongoing unrest in the Middle East and the Russian - Ukraine war.
Traders also weighed the prospect of OPEC+ declaring an extension of production curbs this week and awaited cues from the release of U.S. jobs data.
On the demand side, the global economy is projected to remain resilient despite significant challenges, according to the latest economic outlook report from the Organization for Economic Co-operation and Development (OECD).
The report projects global GDP growth of 3.3% in 2025, up from 3.2% in 2024, and 3.3% in 2026.
Traders also noted Federal Reserve Chair Jerome Powell's speech at the New York Times DealBook Summit. Powel painted a rosy picture of the U.S. economy ahead of key jobs data due Friday. Powell stressed that the current state of the economy allows the Fed to exercise caution in moving rates back down to a more neutral level.
West Texas Intermediate Crude oil futures for January closed down $1.40 or about 2% at $68.54 a barrel.
Brent crude futures were down 1.04 or about 1.41% at $72.58 a barrel a little while ago.
Crude oil inventories in the U.S. fell by much more than expected in the week ended November 29th, the Energy Information Administration revealed in a report released on Wednesday.
Data from the Energy Information Administration said crude oil inventories tumbled by 5.1 million barrels last week after falling by 1.8 million barrels in the previous week. Economists had expected crude oil inventories to dip by 1.0 million barrels.
At 423.4 million barrels, U.S. crude oil inventories are about 5% below the five-year average for this time of year, the EIA said.
Meanwhile, the report said gasoline inventories rose by 2.4 million barrels last week but remain about 4% below the five-year average for this time of year.
Distillate fuel inventories, which include heating oil and diesel, also increased by 3.4 million barrels last week but are about 5% below the five-year average for this time of year, the EIA said.
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