Crude oil prices settled lower on Thursday, after data showed U.S. supplies of crude oil rose for the first time in ten weeks, as several refinery shutdowns last week due to storm Harvey lowered demand for crude.
On the New York Mercantile Exchange crude futures for October delivery fell by 7 cents to settle at $49.09 a barrel, while on London's Intercontinental Exchange, Brent gained 24 cents to trade at $54.44 a barrel.
A report from the Energy Information Administration (EIA) showed crude stockpiles rose more than expected last week, offsetting recent optimism on oil prices, which has seen crude futures settle higher for three straight days. Inventories of U.S. crude rose by roughly 4.6 million barrels in the week ended September 1, as against expectations of a rise of about only 4 million barrels. It was the first weekly build in crude stockpiles for ten weeks.
Gasoline inventories, one of the products that crude is refined into, fell by roughly 3.2 million barrels, missing expectations of a draw of 5 million barrels, while distillate stockpiles fell by 1.4 million barrels, below expectations of a decline of 3 million barrels.
The build in crude stockpiles comes after heavy flooding due to storm Harvey knocked out nearly quarter of the U.S. refining capacity last week, lowering demand for crude oil, the primary input at refineries. Crude oil refinery inputs fell by 3.3 million barrels a day last week, to average 14.5 million barrels a day, while refineries operated at just 79.7% of capacity, the EIA said.
Analysts expect the fallout from storm Harvey will continue to weigh on crude stockpiles, as refiners have been slow to restart operations, while the end of the summer driving season is traditionally associated with a dip in crude oil demand.
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