The oil price is lower Wednesday afternoon, following figures showing the level of US oil stocks rose in the week ending October 12. That build in reported US oil stocks, by the Energy Information Administration (EIA), came as a surprise following reports of a draw, by the American Petroleum Institute (API).
By around 1700 GMT, the price of Brent crude was down by more than 1.8% at $79.89, per barrel. The price of US WTI oil, meanwhile was almost 2.5% lower at $70.13 per barrel.
US oil stockpiles rise
According to the EIA, US oil stocks rose by 6.5 million barrels, while oil exports fell to 1.8 million barrels per day. Meanwhile, crude oil imports into the US, averaged around 7.6 million barrels per day, up around 218,000 per day from the previous week.
The report also stated that at 410 million barrels, “US crude oil inventories are at the five-year average for this time of year,” the EIA said.
The increase in US crude oil stocks worked to push the price of oil lower, as it showed a larger-than-expected rise at a time when fears are rising that oil stocks will decline in the coming months, once the November implementation of the US sanctions on Iranian oil exports is fully in place.
Oil prices could rise amid Khashoggi case
Separately, there are fears that major oil producer, Saudi Arabia, could raise the price of its oil, if it faces any sanctions for the disappearance of the prominent journalist.
Saudi Arabia said in a statement on Sunday, that it plays a “vital role in the global economy”. The statement went on to say it would meet any action take against it with “greater action”.
However, some analysts have warned that if the price of Saudi Arabian drilled oil were to rise, then it could encourage a faster development of the utilisation of other fuel options. Should that occur, then the reliance of the global economy on oil would fall more quickly, weighing on the value of oil.