Oil prices fell on Wednesday following an unexpected increase in US crude oil inventories, with markets focused on the upcoming US-Russia summit meeting.
Brent crude contracts dropped 49 cents, or 0.74%, to close at $65.63 per barrel. US September WTI crude contracts fell 52 cents, or 0.8%, to close at $62.65 per barrel.
The Energy Information Administration (EIA) reported Wednesday that US crude oil inventories increased by 3 million barrels to 426.7 million barrels. Analysts had originally expected a decrease of 275,000 barrels.
The EIA stated that US net crude oil imports increased by 699,000 barrels per day last week.
"Crude export volumes remain below levels we're accustomed to, declining due to tariff policy impacts," said John Kilduff, partner at Again Capital in New York, noting that persistently weak exports could suppress oil prices.
The International Energy Agency (IEA) on Wednesday raised its forecast for global oil supply growth this year while lowering its demand forecast.
Trump is expected to meet with Putin in Alaska on Friday to discuss ending the regional conflict that has roiled oil markets since February 2022.
US Treasury Secretary Scott Bessent said Wednesday that if the meeting doesn't go well, additional sanctions or secondary sanctions could be imposed, and called on European leaders to also deploy sanctions.
"He will make it clear to President Putin that all options are on the table," Bessent said in an interview.
Meanwhile, the Organization of the Petroleum Exporting Countries and its allies (OPEC+) raised their forecast for global oil demand next year in Tuesday's monthly report while lowering estimates for supply growth from the US and other non-OPEC+ producing countries, suggesting the market will tighten.
"Even if we take the midpoint of IEA and OPEC forecasts for 2025 oil demand growth - slightly above 1 million barrels per day - this could easily be met by supply growth from non-OPEC countries alone," said independent energy analyst Gaurav Sharma.
"Therefore, I don't see any reason for oil prices to rise in the short term."