Oil prices were little changed on Wednesday after an increase in U.S. crude stockpiles and demand worries stemming from gloomy economic prospects in Europe offset concerns about conflict in the Middle East escalating.
Brent crude futures fell $0.29 to $87.78 a barrel. U.S. West Texas Intermediate (WTI) crude fell $0.59, or 1%, to $83.15.
Weaker prices in the oil physical markets suggest the rise in prices over the past few weeks may come to an end as demand woes weigh.
U.S. crude inventories (USOILC=ECI) rose by 1.4 million barrels in the last week to 421.1 million barrels, the Energy Information Administration reported on Wednesday, higher than analysts’ expectations in a Reuters poll.
U.S. inventories declined unexpectedly by about 2.7 million barrels in the week ended on Oct. 20, according to market sources citing American Petroleum Institute figures on Tuesday.
Meanwhile, Israel intensified its overnight bombing of southern Gaza, where officials said record numbers of Palestinians had been killed again, as violence flared elsewhere in the region and a showdown loomed at the United Nations on Wednesday over desperately needed aid.
If the conflict widens across the Middle East, oil supplies could be disrupted in a market already undersupplied given protracted OPEC+ cuts.