Oil down on US crude stockpile rise

Oil prices fell on Wednesday in Asia on reports of an unexpected rise in US crude stockpiles.

U.S. Crude Oil WTI Futures fell 0.6% to $61.40 by 12:06 AM ET (04:06 GMT). International Brent Oil Futures were down 0.3% to $71.04.

The American Petroleum Institute (API) reported a large unexpected build in crude oil inventory of 8.6 million barrels for the week ending May 10, significantly over expectations of a 2.125-million-barrel drawdown in inventories.

Last week, the API reported a build in crude oil inventories of 2.81 million barrels. A day later, the EIA contradicted the API’s report, instead estimating a draw of 4-million-barrels.

The inventory data largely overshadowed news of a drone attack at oil pumping stations in Saudi Arabia, which sent oil prices higher the previous day.

Unidentified drones attacked two pumping stations belonging to Saudi Aramco, the state oil company of Saudi Arabia, forcing it to suspend some operations to assess the damage, the government in Riyadh announced Tuesday.

The attacks were reported following Monday’s announcement that two Saudi oil tankers were hit and substantially damaged while heading toward the Strait of Hormuz, the world’s most important chokepoint for oil shipments. The United Arab Emirates added to Monday’s tensions by saying four of its own tankers in the Persian Gulf had been targeted at the weekend.

Meanwhile, US-China trade tension remained in focus as US President Donald Trump said he believed China was still keen to do a trade deal with the US.

Trump then added that he expects a “very fruitful meeting” at the G20 next month with his Chinese counterpart Xi Jinping.