Brent down as U.S. crude build eclipses output freeze plan
By Barani Krishnan
NEW YORK (Reuters) - Brent settled lower on Thursday after data showing U.S. crude inventories rose to record highs overshadowed production freeze plans by oil major producers that had sharply boosted the market this week.
The U.S. government's Energy Information Administration (EIA) said crude stockpiles rose 2.1 million barrels last week, to a peak of 504.1 million barrels in the third week of hitting record highs in past month. [EIA/S]
The EIA also cited record high gasoline inventories and higher stocks of distillates that include heating oil and diesel.
Brent LCOc1, the global benchmark for crude, settled down 22 cents at $34.28 a barrel, having risen more than $1.20 before the data. It had gained a total of more than $4 between Friday and Wednesday.
U.S. crude CLc1 settled up by a modest 11 cents at $30.77 a barrel, after an earlier peak at $31.98. Reuters data showed the daily volume in U.S. crude futures at just over 200 million barrels, down 75 percent from two weeks ago.
Oil prices had risen more than 14 percent over the last three days after a plan by Saudi Arabia and Russia, endorsed without commitment by Iran on Wednesday, to freeze oil output at January's highs.
Thursday's EIA data, if followed through by more builds in U.S. crude, could undermine oil producers' hopes for continued price recovery, traders and analysts said.
"We should see crude sell off in the days to come," said Tariq Zahir, oil trader and fund manager at Tyche Capital Advisors in Long Island, New York. Continued...