In early trading on Wednesday in the Asian session, oil prices continued their decline from the previous day. An industry report showed that U.S. crude and fuel inventories increased, raising concerns about demand growth.
As of 0005 GMT, Brent crude futures were down 14 cents at $77.38 a barrel, a 0.2% drop. U.S. West Texas Intermediate crude futures were down 18 cents at $73.07 a barrel, a 0.3% drop.
On Tuesday, both futures contracts fell nearly a dollar, and on Monday, they dropped about $3 a barrel. Oil prices have been under pressure due to OPEC+ detailing plans to increase supplies from October, while recent signs of weak demand growth have emerged.
According to sources citing data from the American Petroleum Institute (API), U.S. crude, gasoline, and distillate inventories increased last week. A rise in inventories usually indicates that supply is outpacing demand.
API data showed that in the week ending May 31, U.S. crude inventories increased by more than 4 million barrels, while analysts surveyed by Reuters had previously forecast a decline of 2.3 million barrels.
Independent energy analyst Tim Evans said, "We had expected U.S. commercial crude inventories to drop by 1 to 2 million barrels last week, so the API report of a 4.1 million barrel increase is clearly a marked bearish signal."
Gasoline inventories also increased by more than 4 million barrels, well above analysts' expectations of a 2 million barrel increase.
The U.S. Energy Information Administration (EIA) will release official inventory data at 1430 GMT.
The increase in U.S. inventories could significantly impact investor sentiment on oil demand. Last week's data reflected fuel usage during the Memorial Day holiday period, a time closely watched as it marks the start of the U.S. driving season.
