Oil is sloping lower after a jump in US stocks.

By Yuka Obayashi

TOKYO (Reuters) – Oil prices fell on Wednesday on concerns about an unexpected rise in US oil inventories last week, but positive news on COVID-19 vaccines raised investors’ hopes of a recovery. in fuel demand, limiting losses.

futures were down 13 cents, or 0.3%, at $ 48.71 a barrel at 0151 GMT, having gained 5 cents the day before. US West Texas Intermediate (WTI) crude futures fell 15 cents, or 0.3%, to $ 45.45, after losing 16 cents on Tuesday.

The American Petroleum Institute (API) said on Tuesday that stocks of oil, gasoline and distillates rose sharply last week, with crude stocks rising by 1.14 million barrels, contrary to analysts’ forecasts in a Reuters poll of a 1.42 million barrel tie. [API/S]

Official weekly oil data from the US Energy Information Administration (EIA) will be received on Wednesday. [EIA/S]

“The recent rebound seems fundamentally overstated, given rising oil production in Libya and the United States with weaker demand for fuel around the world,” said Kazuhiko Saito, chief analyst at Fujitomi Co.

“But the bullish tone is likely to continue amid hopes that the pandemic can be controlled with vaccines next year.”

Britain began mass vaccinating its people on Tuesday in a global campaign that poses one of the biggest logistical challenges in peacetime history.

Pfizer (NYSE 🙂 overcame another hurdle Tuesday when the US Food and Drug Administration released documents that raised no new red flags about the safety or efficacy of the vaccine it developed with Germany’s BioNTech.

News of the vaccine helped counter fears of a sharp increase in coronavirus cases globally that has led to a series of renewed lockdowns, including strict measures in California, Germany and South Korea.

Hedge fund managers were substantial buyers of oil futures and options last week for the fourth week in a row, a sign of increased confidence that coronavirus vaccines will fuel a recovery in oil consumption next year.

The EIA said Tuesday that U.S. crude oil production is expected to fall next year by 240,000 barrels per day (bpd) to 11.10 million bpd, a minor decline compared to a previous forecast of a drop of 290,000 bpd.