Oil Prices Slip as Investors Take Profits Despite U.S. Inventory Decline
LONDON, July 4 (Reuters) – Oil prices dipped on Thursday, pulling back from multi-month highs reached in the previous session. Investors took profits amid ongoing caution about demand, even after a significant drop in U.S. inventories last week.
By 0855 GMT, Brent crude futures fell 43 cents, or 0.49%, to $86.91 a barrel. U.S. West Texas Intermediate (WTI) crude futures dropped 49 cents, or 0.58%, to $83.39. Trading volume was lighter due to the U.S. Independence Day holiday.
In the previous session, Brent rose 1.3% to settle at $87.34, the highest since April 30. WTI settled at $83.88, marking an 11-week high.
The gains followed a larger-than-expected drop in U.S. crude stocks. The U.S. Energy Information Administration (EIA) reported a 12.2 million barrel draw in inventories, while analysts polled by Reuters had expected only a 680,000 barrel draw.
PVM analyst Tamas Varga noted that despite Thursday’s price dip, the weakness is not expected to last. He cited dollar weakness and an improved outlook for U.S. fuel demand following the EIA data.