US oil edges up after drop in crude inventories, but soaring output weighs

Oil prices inched up on Thursday on a decrease in U.S. crude inventories, but rising gasoline stocks and crude production weighed on the market.

U.S. West Texas Intermediate (WTI) crude futures were at $56.09 a barrel at 0021 GMT, up 13 cents, or 0.2 percent from their last settlement.

Brent crude futures, the international benchmark for oil prices, were yet to trade.

Traders said the higher prices came as U.S. crude oil inventories fell by 5.6 million barrels in the week to Dec. 1, to 448.1 million barrels, putting stocks below seasonal levels in 2015 and 2016.

However, the slightly higher prices came after a much bigger sell-off in late U.S. trading.

“Crude oil prices fell sharply after a larger-than-expected rise in gasoline inventories. This suggests that refiners may not need to process as much crude in the future” ANZ bank said on Thursday.

Gasoline stocks rose 6.8 million barrels, to 220.9 million barrels, much more than analyst expectations in a Reuters poll for a gain of 1.7 million barrels.

“The EIA report also showed that U.S. production increased again,” it added.

U.S. crude production climbed by 25,000 barrels per day (bpd) to 9.71 million bpd, the highest since monthly figures showing the United States produced more than 10 million bpd in the early 1970s. Source: Reuters