(Bloomberg) -- Oil erased some gains after its biggest price rally since the attacks on Saudi facilities five weeks ago following a surprise decline in U.S. crude stockpiles.
Futures dropped 0.8% in New York after advancing 2.7% on Wednesday. American crude inventories shrank by 1.7 million barrels last week, compared with a forecast 3-million barrel gain in a Bloomberg survey. Gasoline supplies fell more than forecast and imports of foreign oil slid to the lowest in more than two decades, according to the Energy Information Administration.
Oil is still down more than 15% from an April peak as the prolonged trade dispute between Beijing and Washington dented global demand. Russia’s energy minister Alexander Novak said none of the OPEC+ members have submitted a proposal to change existing conditions of their output-curb deal, following a Reuters report Tuesday that the group may be considering deeper cuts.
“Worries over demand growth may have taken the back seat for a day, but they will surely reclaim center-stage again,” said Vandana Hari, the founder of industry consultant Vanda Insights in Singapore. “That is likely to remain the most entrenched and enduring narrative in the oil market until the U.S. and China put their trade war behind them.”
West Texas Intermediate for December delivery lost 47 cents to $55.50 a barrel on the New York Mercantile Exchange as of 10:40 a.m. Singapore time. The contract added $1.49 to close at $55.97 on Wednesday, the biggest increase since Sept. 16.
Brent for December settlement fell 34 cents, or 0.6%, to $60.83 a barrel on the London-based ICE (NYSE:ICE) Futures Europe Exchange. The contract rose $1.47 to $61.17 on Wednesday. The global benchmark crude traded at a $5.32 premium to WTI.