US inventory data pressured oil prices in early trading Thursday, after showing a more-than-expected increase, raising concerns about demand in the world's largest economy.

Price action

By 0135 GMT, Brent crude futures fell 34 cents, or 0.4 percent, to $81.26 per barrel. US West Texas Intermediate crude futures also fell 36 cents, or 0.5 percent, to $76.28 per barrel.

The two benchmarks lost more than a dollar per barrel yesterday, Wednesday, due to the rise in US crude inventories, with refining falling to its lowest levels since December 2022.

The Energy Information Administration said that US crude inventories jumped by 12 million barrels to 439.5 million barrels in the week ending February 9, far exceeding analysts’ expectations in a Reuters poll of an increase of 2.6 million barrels.

However, EIA data showed that gasoline and distillate inventories fell more than expected. Gasoline stocks fell by 3.7 million barrels to 247.3 million barrels, compared to expectations for a decrease of 1.2 million barrels.

Distillate stocks fell by 1.9 million barrels to 125.7 million barrels, compared to expectations for a decrease of 1.6 million barrels.

As for supplies, Kazakhstan said it will reduce oil production after surplus production in January over the next four months, in line with its OPEC+ commitments. Iraq also announced that it will review its oil production and address any surplus production that exceeds its voluntary OPEC+ cuts in the next four months, if any.

This comes before the OPEC meeting in March, as the group plans to decide whether to extend supply cuts in the second quarter, ANZ analysts said in a note on Thursday.

They added that any indications that an extension seems unlikely would affect sentiment in oil markets.