Oil prices fell in Asian trade on Wednesday, pressured by persistent concerns over a looming supply glut, while industry data showing an outsized build in U.S. inventories also sparked fears of sluggish demand.
Crude prices had surged at the beginning of the week after the Organization of Petroleum Exporting Countries and allies, OPEC+, said it will pause its ongoing production hikes from the first quarter of 2026.
But the OPEC+ move failed to clear market concerns over a supply glut, while broader uncertainty over the U.S. economy and a fragile trade truce with China weighed. Strength in the dollar, which surged to a three-month high, also pressured oil prices.
Brent oil futures for January fell 0.6% to $64.06 a barrel, while West Texas Intermediate crude futures fell 0.7% to $59.88 a barrel by 20:50 ET (01:50 GMT).
US inventories unexpectedly grow 6.5 mln- API data Data from the American Petroleum Institute showed U.S. oil inventories grew 6.5 million barrels in the week to November 1, blazing past analyst expectations for a 2.4 mln barrel draw.
The reading usually heralds a similar print from official inventory data, which is due on Wednesday.
The outsized inventory build sparked concerns over sluggish U.S. fuel demand, especially as an ongoing government shutdown disrupted air travel in large swathes of the country.
The shutdown showed few signs of ending this week, as the Senate remained in deadlock over more government funding.
Oil pressured by oversupply concerns, strong dollar Oil prices remained on the backfoot, having taken limited support from the OPEC+ agreeing to pause its production hikes in the first quarter of 2026.
While the pause does point to some curbs in supply, it also comes after the OPEC+ hiked production by nearly 3 million barrels per day this year.
The cartel will also signaled a production hike in December, keeping markets largely on edge over a potential supply glut in 2026.
Global oil demand was seen cooling steadily this year, amid sluggish growth in top oil importer China, especially as the country became embroiled in a trade war with the United States.
Strength in the dollar also pressured oil markets over the past week, after the Federal Reserve signaled that a December interest rate cut was not a given.
