Oil slid toward $57 a barrel after industry data showed U.S. gasoline stockpiles expanded for the first time in four weeks.
Futures dropped 0.4 percent in New York after rising 0.3 percent on Tuesday. Motor fuel inventories climbed by 9.2 million barrels last week, the American Petroleum Institute was said to report. That will be the biggest gain since January 2016 if replicated in government data due on Wednesday. Nationwide crude stockpiles declined, according to the API data.
Oil is averaging about $54 a barrel this quarter, the highest in more than two years, after the Organization of Petroleum Exporting Countries and its allies agreed to extend output curbs until the end of 2018. Libya will maintain its current production level until the end of next year to stay in line with OPEC’s deal to trim global supplies, according to a person familiar with the matter.
“Investors will continue to watch developments in the U.S. after the OPEC deal,” said David Lennox, a commodity analyst at Fat Prophets in Sydney. “The market will also look for continued compliance to the supply agreement. If they do adhere, that will keep the oil price elevated.”
West Texas Intermediate for January delivery was at $57.42 a barrel on the New York Mercantile Exchange, down 20 cents, at 7:45 a.m. in London. Total volume traded was about 42 percent below the 100-day average. Prices rose 15 cents to $57.62 on Tuesday.
See also: China Guzzles Record Volume of U.S. Crude Amid OPEC Cuts: Chart
Brent for February settlement lost 16 cents to $62.70 a barrel on the London-based ICE Futures Europe exchange after adding 41 cents on Tuesday. The global benchmark traded at a premium of $5.22 to February WTI.
U.S. crude inventories dropped by 5.48 million barrels last week, the API said Tuesday, according to people familiar with the data. An Energy Information Administration report on Wednesday is forecast to show supplies fell by 2.5 million barrels, according to a Bloomberg survey.
Saudi Arabia raised pricing for January sales of all its crude grades to Asia, according to a statement from state-owned Saudi Arabian Oil Co.