WTI crude retains losses as US inventories jump, Brent down

West Texas Intermediate fell on Wednesday as the Energy Information Administration reported a larger-than-expected jump in US crude oil inventories in the week ended November 21st, while domestic crude production surged to a new record. Brent fell as well.

January US crude fell 0.63% to $73.62 per barrel by 15:42 GMT. Prices held in a daily range between $74.48 and $73.30 a barrel, the lowest since November 14th. The contract lost 2.23% on Tuesday to $74.09 and is currently trading 28.23% lower from its June peak.

Meanwhile on the ICE, Brent for delivery in the same month fell 0.71% to $77.77 a barrel, having shifted in a daily range between $78.86 and $77.30, also the lowest since November 14th. The European crude benchmark dropped 1.69% on Tuesday to $78.33, settling at a premium of $4.24 to WTI. The gap narrowed to $4.15 on Wednesday.

Data by the Energy Information Administration showed on Wednesday that US crude supplies jumped by 1.946 million barrels to 383.0 million last week, exceeding analysts projections for a 250 000-barrel increase. Inventories at the Cushing, Oklahoma storage hub rose by 1.4 million barrels to 24.6 million.

Domestic crude production surged to 9.077 million barrels per day from 9.004 million last week, the highest on record for weekly data dating back to January 1983. Imports fell to 7.473 million barrels per day from 7.638 million bpd a week earlier, while the four-week average of inbound shipments was at 7.166 million bpd, 6.5% lower from a year earlier.

Refineries operated at 91.5% of their operable capacity, compared to 91.2% during the week ended November 14th. Both motor gasoline and distillate fuel output increased last week, averaging 9.6 and 4.9 million barrels per day, respectively.

Total motor gasoline supplies gained 1.825 million barrels to 206.4 million, exceeding analysts projections for a jump of 1.817 million. Distillate fuel inventories, which include diesel and heating oil, fell by 1.648 million barrels to 113.1 million, topping forecasts for a 0.550-million increase.

The market earlier received heavy pressure on the demand side as initial jobless claims rose to 313 000 in the week ended November 22nd, the highest since early September, while pending home sales unexpectedly contracted in October and the annualized growth pace of new home sales came in below expectations.

A better-than-projected durable goods orders report for October fanned positive sentiment but the Thomson Reuters/University of Michigan Consumer Sentiment Index unexpectedly slid in November, confirming a drop in consumer confidence reported by the Conference Board on Tuesday.