By Yasin Ebrahim
Investing.com -- U.S. crude oil inventories unexpectedly increased last week, confounding expectations for a decline and adding to the bulging weight of expectations that energy demand destruction is underway amid growing fears of a recession.
West Texas Intermediate, the U.S. benchmark, traded at $98.00 per barrel following the report after settling down $0.97 at $98.53 per barrel, a 12-week low.
U.S. crude inventories increased by about 3.8 million barrels for the week ended June 30. That compared with a draw of 3.8 million barrels reported by the API for the previous week. Economists were expecting a decrease of about 1.1 million barrels.
The API data also showed that gasoline inventories fell by 1.8 million barrels last week, while distillate stocks decreased by about 635,000 barrels.
Bets on oil prices likely heading lower rather than higher have increased, pushing oil prices further under $100 a barrel this week as markets price in the prospect of a global recession and the likely hit to energy demand.
Citigroup warned earlier this week that oil prices could plummet to $65 a barrel by the end of this year and fall to about $45 by the end of 2023 if the economy falls into recession.
The official government inventory report due Thursday is expected to show weekly U.S. crude supplies fell by about 1.0 million barrels last week.