Oil prices ticked up slightly on Thursday, stabilizing after previous declines triggered by a larger-than-expected buildup in U.S. fuel inventories and a price reduction from top oil exporter Saudi Arabia.
As of 07:30 ET (11:30 GMT), Brent crude futures edged down 0.2% to $64.75 per barrel, while West Texas Intermediate (WTI) futures slipped 0.2% to $61.74 per barrel.
Inventory Data Signals Demand Concerns
Prices had dropped over 1% the day before, following U.S. government data showing a substantial 4.3 million-barrel drawdown in crude oil inventories—larger than analysts had predicted.
However, this bullish signal was offset by a significant surge in fuel stockpiles. Gasoline inventories rose by 5.2 million barrels, and distillate stocks climbed by 4.2 million barrels, both figures far exceeding expectations and raising doubts about the strength of fuel demand heading into the peak summer travel season.
These concerns were compounded by weaker-than-expected private payroll data, suggesting the U.S. labor market may be cooling—just days ahead of Friday’s nonfarm payrolls report for May, a closely watched economic indicator.
Uncertainty also lingered around U.S. trade policy after President Donald Trump doubled tariffs on steel and aluminum to 50%. A self-imposed deadline for trade partners to present improved offers passed without any new deals, further unsettling markets.
Saudi Arabia Slashes Oil Prices for Asia
Adding pressure to prices, a Reuters report revealed that Saudi Arabia had reduced its July oil prices for Asian buyers to their lowest level in two months, a move likely reflecting the kingdom’s concern over weak regional demand.
The price cut followed the recent OPEC+ decision—led by Saudi Arabia—to raise oil production in July. Although this increase mirrored previous monthly adjustments and helped lift prices somewhat, it also heightened worries about oversupply in a market already facing demand headwinds.
According to recent reports, Saudi Arabia may be strategically lowering prices to discipline overproduction by fellow OPEC members and strengthen its market share.
