London — Crude oil futures took a hit following the unexpected weekly crude stocks report by the American Petroleum Institute that showed a build in US inventories, with the Brent futures front-month contract holding below the $72/b mark during the morning trading session in Europe Wednesday.
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Register NowAt 1050 GMT October ICE Brent crude was 71 cents/b lower than Tuesday's close at $71.75/b, while the September NYMEX WTI crude was down 83 cents/b at $66.21/b.
The API report showed a 3.6 million barrel build for the week ended August 10, while a consensus of analysts surveyed by S&P Global predicted a draw of around 1.7 million barrels.
Healthy refining margins were cited as a factor that would have encouraged a fall in inventory levels prior to the API data release.
The US Energy Information Agency is due to follow up with its more definitive weekly stocks report Wednesday.
In other oil data, crude oil imports by Chinese independent refiners are expected to rebound marginally in August, on lower maintenance shutdowns and an improvement in refining margins, which should be a supportive factor for the global crude market.
Around 7.4 million mt of crude is estimated to discharge in August at ports in Tianjin and Shandong provinces -- home to the country's independent refineries -- compared with 7.38 million mt in July, a survey by S&P Global Platts showed.
Qingdao port is expected to see deliveries rise by about 400,000 mt to around 3.3 million mt, offsetting an anticipated decline of about 200,000 mt at Yantai port, according to port sources.
Monthly crude imports by the independent refiners have averaged 8.18 million mt in the first seven months of 2018, with volumes hitting a low of 5.78 million mt in June.
The anticipated rise in crude imports stemmed mainly from the restart of 31.7 million mt/year of capacity across around 10 independent refineries in August, from turnarounds that started in July.
This sharply offsets a combined 5.7 million mt/year capacity to be shut by Qirun Petrochemical and Lanqiao Petrochemical for maintenance during August.
In other financial markets, the dollar index was up 0.24% at 96.78. In equities markets, the S&P 500 was down 0.64% and the FTSE 100 down 0.86%.
--Ahila Karan, ahila.karan@spglobal.com
--Edited by Maurice Geller, maurice.geller@spglobal.com