USOI - Crude oil slips as surprise U.S. inventory build offsets demand signals

2023-05-10 17:50:13 ET

The energy sector ( NYSEARCA: XLE ) was Wednesday's biggest sector decliner, -1.1% , as crude oil prices fell due to ongoing growth concerns as well as an unexpected buildup in U.S. inventories.

U.S. commercial crude inventories rose by 3M barrels to 462.6M barrels for the week ended May 5, compared with expectations for a 900K-barrel drop, and the U.S. Strategic Petroleum Reserve drew down for a sixth straight week, falling 2.9M barrels to 362M barrels, the lowest level since October 1983.

Front-month Nymex crude ( CL1:COM ) for June delivery snapped a three session winning streak, settling -1.6% to $72.56/bbl, bringing May losses to 5.5%, and July Brent crude ( CO1:COM ) closed -1.3% to $76.41/bbl, ending a four session streak.

ETFs: ( NYSEARCA: USO ), ( BNO ), ( UCO ), ( SCO ), ( DBO ), ( USL ), ( DRIP ), ( GUSH ), ( USOI ), ( NRGU ), ( XLE ), ( XOP ), ( VDE ), ( OIH )

Data indicated fuel demand may be picking up, with gasoline stocks declining more than expected and product net exports jumping 8.5% for the week to more than 4.3M bbl/day, but it was not enough to extend the recent rally.

U.S. crude oil has lost nearly 10% YTD as worries over a potential U.S. recession have outweighed a still solid physical market and supply cuts by Saudi Arabia and its allies .

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