Oil prices slipped in Asian trade on Thursday after official data showed a much larger-than-expected build in U.S. crude stocks, while a Washington-backed Ukraine peace framework raised the prospect of more Russian supply returning to markets.
As of 21:19 ET (02:19 GMT), Brent Oil Futures expiring in January fell 0.25% to $62.84 per barrel, while West Texas Intermediate (WTI) crude futures slipped 0.4% to $58.40 per barrel.
Both contracts gained over 1% on Wednesday as markets hiked up bets for a Federal Reserve rate cut next month, a move which generally supports crude prices.
US crude stocks jump above expectations - EIA
The U.S. Energy Information Administration reported on Wednesday that crude inventories rose by 2.8 million barrels in the week to Nov. 21, versus market expectations for only a small increase og 55,000 barrels.
Total motor gasoline stocks increased by 2.5 million barrels, and distillate inventories rose by 1.1 million barrels, reflecting a mixed demand picture in the fuel complex.
"The increase was driven by a 560k b/d week-on-week decline in crude exports, while imports were up 486k b/d," ING analysts said in a note.
The surprise builds helped cap prices after earlier gains, reinforcing concerns that global supply could outpace demand into 2026. The EIA and other forecasters have pointed to rising production and inventories that will weigh on prices next year.
Russia-Ukraine peace prospects pressure oil
Meanwhile, the U.S. is pressing ahead with a Russia-Ukraine peace plan, and Ukrainian President Volodymyr Zelenskiy has signalled readiness to advance a U.S.-backed framework.
U.S. envoy Steve Witkoff is scheduled to travel to Moscow next week to discuss the plan, a move that has raised the possibility of a ceasefire or deal that could loosen some Western constraints on Russian energy exports.
Such an outcome would likely add supply to already well-stocked markets and further pressure prices.
"A peace deal would likely remove much of the supply risk facing the market, potentially leading to the lifting of US sanctions on Russia. For today, though, market action is likely to be relatively muted due to the US Thanksgiving holiday," ING analysts wrote.
"OPEC+ is set to meet this weekend. We believe the group will leave production unchanged. The fundamental outlook remains fairly similar to where it was at the group’s last meeting," they added.
Source: Investing