Oil complex mixed on back of massive US crude stock build; NYMEX WTI up at $75.29/b, ICE Brent $85.01/b

Crude oil and product futures were mixed in midmorning trading Wednesday in the wake of US Energy Information Administration data showing US crude supply grew sharply last week.

Total US commercial crude stocks added 7.98 million barrels during the week ended September 28, EIA said, far exceeding analyst expectations of a 2.76 million-barrel build.

The impact of the stock build on crude prices was immediate but brief. Crude futures, which were already trading lower, dropped even further following the release but later recovered to trade in positive territory. NYMEX November WTI was 6 cents higher at $75.29/b and ICE December Brent was up 21 cents at $85.01/b.

At 1425 GMT, prior to the EIA release, NYMEX November WTI was down 29 cents at $74.94/b and ICE December Brent was down 12 cents at $84.68/b.

Bearish sentiment was already leading the market ahead of the release after comments from leaders in Russia and Saudi Arabia suggested that their production could increase, partially offsetting the impact of US sanctions on Iran in November.

Russian Energy Minister Alexander Novak said Wednesday that Russia's oil production, which hit a record high of 11.36 million b/d in September, still has the potential for further growth, though he declined to specify how much.

Meanwhile, Energy Minister Khalid al-Falih told reporters that Saudi Arabia is currently pumping 10.7 million b/d, near its all-time high. Saudi oil production averaged 10.42 million b/d during August. November production would be slightly higher than current levels, Falih said.

Product futures were mixed on Wednesday after EIA data showed lower-than-expected inventory declines. NYMEX November ULSD was up 47 points at $2.4123/gal, but NYMEX November RBOB was down 1.25 cents at $2.1144/gal.

Distillate stocks were down 1.75 million barrels last week, EIA said, just shy of analyst expectations of a 1.83 million-barrel draw, but gasoline stocks shed only 459,000 barrels last week, well below analyst expectations of a 672,000-barrel draw.

source: S&P Global Platts