Oil near $65 as OPEC fears weigh against US stockpile drop

Bloomberg

Oil traded near $65 a barrel as an industry report showing a drop in American crude stockpiles countered fears about a potential OPEC supply boost.
Futures in New York fell 0.7 percent, following a 1.2 percent advance on Tuesday. The American Petroleum Institute was said to report nationwide crude inventories declined by over 2 million barrels last week. Meanwhile, the US has asked Saudi Arabia and some other members of the Organization of Petroleum Exporting Countries to increase output by about 1 million barrels a day, according to people familiar with the matter.
Oil is trading near the lowest level in almost two months after Saudi Arabia and Russia signaled they are ready to ease output curbs to fill potential supply losses in Iran and Venezuela. As speculation swirls over whether OPEC and its allies will relax the caps at a meeting in Vienna later this month, Goldman Sachs Group Inc. is still bullish on oil as it says stockpiles will continue to diminish this year.
“The API number, if confirmed, should help prices,” says UBS Group AG analyst Giovanni Staunovo. “The market should stay in deficit” despite Venezuela President Nicolas Maduro’s comments his country stands ready to raise production should OPEC decide to do so, he said.
West Texas Intermediate for July delivery fell 46 cents to $65.06 a barrel on the New York Mercantile Exchange.
Brent futures for August settlement declined 49 cents to $74.89 a barrel on the London-based ICE Futures Europe exchange, after closing 9 cents higher on Tuesday.
The global benchmark crude was $9.90 above WTI for the same month.
US crude stockpiles decreased by 2.03 million barrels last week, while the hoard at the key storage hub in Cushing, Oklahoma, fell by 1.04 million barrels, the industry-funded API was said to report. Energy Information Administration data due Wednesday is expected to show nationwide stockpiles dropped by 2.1 million barrels, according to a Bloomberg survey.
In a rare request, the US government has quietly asked Saudi Arabia and some other OPEC members to boost crude production after retail gasoline prices surged to their highest in more than three years and President Donald Trump publicly complained about the group’s policy and rising oil prices on Twitter.
Saudi Arabia, the world’s largest oil exporter, raised pricing on key crude grades for buyers in Asia to the highest since 2014 as demand builds in the country’s biggest market amid threats to rival suppliers.