Crude Oil Prices Settle at Six-Week Lows as U.S.-China Trade War Intensifies

Investing.com – WTI crude oil prices settled at six-week lows Wednesday after data showed U.S. crude stockpiles fell less than expected and U.S.-China trade tensions intensified.

On the New York Mercantile Exchange for September delivery fell 3.3% to settle at $66.90 a barrel, while on London’s Intercontinental Exchange, fell 3.26% to trade at $72.22 barrel.

Inventories of U.S. crude fell by 1.351 million barrels for the week ended Aug. 3, missing expectations for of 2.800 million barrels, according to data from the Energy Information Administration (EIA).

The smaller-than-expected draw in crude supplies came as imports rose by about 2.64 million barrels a day (bpd) and exports rose by 5.40 million bpd, data from EIA showed.

Gasoline inventories by 2.900 million barrels, confounding expectations for a draw of 1.700 million barrels, while supplies of distillate – the class of fuels that includes diesel and heating oil – by 1.230 million barrels, against expectations for a build of 0.220 million barrels.

The build in products came as refinery activity rose to 96.6% of their capacity last week from 96.1% a week earlier, with inputs averaging about 17.6 million barrels per day during, up 118,000 barrels from the prior week, the EIA said.

U.S. oil production fell for the second straight week to 10.8 million bpd from a record high 11 million bpd reported in late-July, pointing to ongoing domestic oil producer struggles to transport oil from the Permian Basin to market amid pipeline shortages.

Prior to the data, oil prices were already on the back foot as the China slapped a 25% tariff on another $16 billion worth of U.S. products, including crude.

The announced from China arrived after U.S. Trade Representative’s office released a finalized list of $16 billion worth in Chinese goods that will be subject to tariffs.

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