Oil prices fell about 2 percent on Wednesday after data from the Energy Information Administration showed a surprise build in U.S. crude stockpiles.
June Brent crude futures were down $1.27 to $68.19 barrel by 11:50 a.m. EDT (1550 GMT), while the May contract, which expires on Thursday, fell $1.11, or 1.6 percent, to $69.00 a barrel.
West Texas Intermediate (WTI) crude futures for May delivery fell $1.32 to $63.93 a barrel, a 2-percent loss.
U.S. crude`s discount to Brent widened to as much as $5.22, the biggest since Jan. 24.
U.S. crude inventories rose 1.6 million barrels last week, compared with analysts` expectations for a decrease of 287,000 barrels, as net imports soared by 1.1 million barrels per day, the EIA said. [EIA/S]
"It was a big import week, and they were up over a million barrels a day," said Bob Yawger, director of energy futures at Mizuho. "So that`s where you get your build from."
Stocks at the Cushing, Oklahoma, delivery hub for U.S crude futures also rose 1.8 million barrels, EIA said.
"Oil supplies at Cushing, Oklahoma are starting to replenish, which is bearish for prices, but they have a long way to go to near normal levels of supply," said John Kilduff, partner at energy hedge fund Again Capital LLC in New York.
U.S. crude production also inched up last week to fresh record high at 10.433 million bpd. Output has risen by nearly 25 percent in the last two years to over 10 million bpd, taking it past top exporter Saudi Arabia and within reach of the biggest producer, Russia, which pumps around 11 million bpd.
Brent prices have risen in seven out of the last nine months and have increased by about 3 percent this year. Prices have also had three consecutive quarters of gains, the longest stretch since late 2010 and early 2011, after production curbs led by the Organization of the Petroleum Exporting Countries since last year.
Wednesday`s price falls came despite Saudi Arabia saying it was working with Russia on a long-term pact that could extend controls over world crude supplies by major exporters for many years.
Saudi Crown Prince Mohammed bin Salman told Reuters on Tuesday that Riyadh and Moscow were considering greatly extending the short-term alliance on oil curbs that began in January 2017 after a crash in crude prices, with a partnership to manage supplies potentially growing "to a 10-to-20-year agreement."
(This article has not been edited by Zeebiz editorial team and is auto-generated from an agency feed.)