Oil Inventories Shrink 3.1M Barrels

Petroleum prices faded on Wednesday as data suggesting a smaller-than-expected fall in U.S. crude inventories countered support from hopes for a U.S.-China trade deal.

Brent crude futures were down 51 cents at $61.63 U.S. a barrel, mid-morning Wednesday.

U.S. West Texas Intermediate crude fell 25 cents to $53.65 U.S. a barrel. On Tuesday, it had recorded its biggest daily rise since early January.

After weeks of swelling, U.S. crude stocks fell by 812,000 barrels last week to 482 million, the American Petroleum Institute said on Tuesday, a smaller fall than the 1.1-million-barrel drop analysts had expected.

Official estimates from the U.S. government’s Energy Information Administration found U.S. crude inventories decreased by 3.1 million barrels last week. The reported EIA data was more bullish than previous supply data released on Tuesday.

U.S. President Donald Trump offered some support, saying preparations were starting for him to meet Chinese President Xi Jinping next week at the G20 summit in Osaka, Japan.

Trump has repeatedly threatened to slap more tariffs on Chinese goods.

On Wednesday, oil markets shrugged off a rocket attack on a site in southern Iraq used by foreign oil companies.

Finally, members of the Organization of the Petroleum Exporting Countries have agreed to meet on July 1, followed by a meeting with non-OPEC allies on July 2, after weeks of wrangling over dates.

OPEC and its allies will discuss whether to extend a deal on cutting 1.2 million barrels per day of production that runs out this month.