By Alison Sider
Crude oil settled lower after flipping between gains and losses Wednesday, as renewed optimism that major oil producers could agree to scale back production competed with data showing that crude supplies are still swelling.
Prices began to move higher Wednesday afternoon after Russian Energy Minister Alexander Novak told reporters at a Moscow energy forum that Russia would "support any decision" adopted by the Organization of the Petroleum Exporting Countries, according to media reports.
But the rally couldn't be sustained, and attention turned to persistently bearish supply figures. Mr. Novak's comments boosted prices shortly after a report from the U.S. Energy Information Administration showed a 5.3-million-barrel increase in U.S. crude supplies last week -- well above the 1.1-million-barrel increase anticipated by analysts and traders surveyed by The Wall Street Journal.
Crude prices traded as high as $46.41 a barrel on the New York Mercantile Exchange, before dropping to $45.50 -- down 31 cents, or 0.68%, from Tuesday. Brent, the international benchmark, fell 32 cents, or 0.68%, at $46.63 a barrel.
Oil markets have been whipsawed in recent weeks as market participants have tried to suss out the likelihood that OPEC will come to an agreement to cut output. Many had become broadly skeptical as some members raised disputes with the plan, but reports of increasing efforts to work out a deal prompted a 5.75% increase in prices Tuesday.
Mr. Novak is slated to meet with oil ministers from Saudi Arabia and Qatar later this week.
Wednesday's data showing swelling U.S. stockpiles puts more pressure on OPEC, analysts said. Gasoline and diesel inventories also increased, and total stocks of petroleum products increased by 7.1 million barrels.
"They've got to come up with some kind of deal or it's going to get pretty ugly," said Bob Yawger, director of the futures division at Mizuho Securities USA Inc.
But there were signs of increasing demand for crude by refiners, which are coming out of seasonal maintenance. Refiners processed 16.1 million barrels of oil during the week, up from 15.8 the previous week, and refinery utilization jumped from 87.1% to 89.2% -- well above the 87.9% forecast by traders and analysts.
Gasoline futures fell 1.59 cents, or 1.19%, at $1.3191 a gallon. Diesel futures fell 0.89 cents, or 0.62%, at $1.435 a gallon
--Neanda Salvaterra, Dan Strumpf, and Benoit Faucon contributed to this article.
Write to Alison Sider at firstname.lastname@example.org(END) Dow Jones Newswires
November 16, 2016 15:33 ET (20:33 GMT)
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