USO trades down 1.18% to $143.20 a share
Brent crude holds closer to flat than its US counterpart, keeping the spread between the two benchmarks in view
Published
Chart: USO, a fund that tracks crude, one-minute prices, three sessions
US crude oil futures trade down $1.16, or 1.3%, at $88.28 a barrel on Wednesday afternoon. Brent crude futures are down 38 cents, or 0.38%, at $100.20 a barrel.
The American Petroleum Institute estimated that US crude inventories fell by 2.09 million barrels in the week ending October 2, reversing a build of 1.019 million barrels the week before, according to Oilprice.com. The same report showed Cushing, Oklahoma, the delivery point for WTI futures, gained 866,000 barrels, while US crude production for the week ending September 25 rose to 13.955 million barrels a day from 13.939 million the week before, Oilprice.com reported. The government's own weekly inventory report for the week ending October 2 was due out this afternoon.
The Energy Information Administration's October Short-Term Energy Outlook said oil prices are likely to stay elevated until constraints on Middle East oil flows ease and inventories can be rebuilt, according to the agency's report.
The wider gap between the US and Brent moves points to pressure specific to American supply rather than a broad shift in global demand, since a shared supply or demand shock would typically move both benchmarks by similar amounts. That divergence keeps the spread between the two grades in focus, with US inventory and production data likely driving the domestic contract more than international conditions. Without a common catalyst, the two benchmarks may continue to trade somewhat apart from each other in the near term.