Crude oil prices were hovering near one-week lows on Thursday, as investors remained cautious due to sustained U.S. dollar strength and following news of an increase in U.S. stockpiles last week.
The U.S. West Texas Intermediate Crude Oil WTI Futures April contract was up 10 cents or about 0.21% at $61.74 a barrel by 07:35 am GMT, just off Wednesday’s one-week lows of $61.37.
Elsewhere, Brent oil for April delivery on the ICE Futures Exchange in London edged up 16 cents or about 0.25% to $64.88 a barrel, after hitting a one-week trough of $64.50 in the previous session.
Oil prices were hit after the U.S. Energy Information Administration reported on Wednesday that crude oil inventories rose by 3.019 million barrels for the week ended Feb. 23, exceeding expectations for a rise of 2.4 million barrels.
The report also showed that gasoline inventories rose by 2.483 million barrels, confounding expectations for a decline of 190,000 barrels.
The massive build in gasoline stockpiles garnered most of the attention as some market participants had expected that a slowdown in refinery activity – as refiners enter a period of maintenance – would lead to fall in gasoline supplies.
The data came a day after the American Petroleum Institute reported a 933,000 barrels increase in last week’s crude oil stockpiles, albeit less than the expected increase of 2.7 million barrels.
Fears that rising U.S. output could dampen global efforts to rid the market of excess supplies have systematically limited oil prices’ gains recently.
The Organization of the Petroleum Exporting Countries (OPEC), along with some non-OPEC members led by Russia, agreed in December to extend oil output cuts until the end of 2018.
The deal to cut oil output by 1.8 million barrels a day (bpd) was adopted last winter by OPEC, Russia and nine other global producers. The agreement was due to end in March 2018, having already been extended once.
Oil prices were also under pressure as expectations for more aggressive rate hikes by the Federal Reserve this year pushed the U.S. dollar higher.
The U.S. dollar index, which measures the greenback’s strength against a trade-weighted basket of six major currencies, was little changed at a six-week high of 90.63.
A stronger greenback often weighs on prices for dollar-denominated commodities.
Elsewhere, gasoline futures were up 0.10% at $1.929 a gallon, while natural gas futures slid 0.30% to $2.659 per million British thermal units.