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Oil futures fell in Asian trade on Wednesday after industry data pointed to a potential ninth straight week of inventory builds. renewing concerns about an oversupply of oil despite output curbs by OPEC and non-OPEC members.
Brent futures were down 23 cents. or 0.4%. at $55.69. after settling down 0.2% in the previous session. US West Texas Intermediate crude fell 29 cents. or 0.6%. to $52.85 a barrel. after ending the previous session down 0.1%. Reuters reported.
Oil is range-bound. If prices dip below $50 a barrel. OPEC will cut more. if it goes above $55 the US will produce more. said Jonathan Barratt. chief investment officer at Ayers Alliance in Sydney.
US crude stocks rose by 11.6 million barrels last week. more than five times analysts` estimates. according to industry group. the American Petroleum Institute. The latest figures were due to be released on Wednesday by the US Energy Information Administration. Analysts have forecast a 1.7 million barrel inventory build.
All eyes are on the EIA numbers. said Jeffrey Halley. senior market strategist at Oanda in Singapore. A big washout of that will see oil test technical support levels.
Oil prices are facing headwinds from a likely US Fed interest rate hike next week. a strong dollar. increasing inventory builds to record levels and rising US shale oil production. he said.
At the same time. members of an OPEC-led production agreement said on Tuesday total output reductions are more than 1.5 million barrels per day and are meeting their expectations.
