Brent oil price trading steady on higher US stocks data

Brent crude oil prices are trading steady on Wednesday, slightly down 45 cents at $71.69 on London’s ICE Futures Exchange after an overhight jump higher.

US crude oil stocks jumped 7.2 million barrels last week, the API said late Tuesday, suggesting weak consumer demand for fuels like gasoline and heating oil. Analysts had expected an increase of 2 million barrels, according to a survey by Platts, the energy information arm of McGraw-Hill Cos. The US Energy Department’s EIA has delayed announcement of its inventory report until Friday from Wednesday because of US snow storms.

Sluggish crude oil demand is weighing on oil prices as investors continue to mull over concerns about the health of the global economy. Oil prices settled more than two percent higher on Tuesday, buoyed by a weaker US dollar, gains in global stock markets and a huge snowstorm looming over the US Northeast, the world’s largest consumer of heating oil.

“The market should not get too bearish despite the rise in weekly inventories, because of the snowstorms sweeping across the Northern Hemisphere. Oil prices should not fall below $70. It will remain driven by the US dollar’s movements and the mood in the financial markets.” said Keiichi Sano, general manager of research at Tokyo-based SCM Securities.

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