July 18, 2018 / 12:52 AM / 5 months ago

Oil prices fall after surprise rise in U.S. inventories

TOKYO, July 18 (Reuters) - Oil prices dropped on Wednesday after an industry group reported that U.S. crude inventories rose last week, defying analyst expectations for a significant reduction.

Brent futures were down 40 cents, or 0.6 percent, at $71.76 a barrel by 0027 GMT. They rose 32 cents to $72.16 a barrel on Tuesday, after earlier touching a three-month low.

U.S. West Texas Intermediate crude was down 27 cents, or 0.4 percent, at $67.82. It settled up 2 cents at $68.08 a barrel the session before, coming off a nearly one-month low.

The benchmarks had steadied after big declines on Monday and last week as supply disruptions in Venezuela came to the fore and as analysts had been forecasting a decline of 3.5 million barrels in U.S. inventories for the week through July 13.

But the spectre of oversupply quickly returned, with a rise of more than 600,000 barrels in U.S. crude stockpiles, reported by the American Petroleum Institute late on Tuesday.

Gasoline stocks rose by 425,000 barrels, compared with expectations in a Reuters poll for a 44,000-barrel decline.

Distillate fuels stockpiles, which include diesel and heating oil, rose by 1.7 million barrels, compared with expectations for an 873,000-barrel gain, the data showed.

Refinery crude runs fell by 279,000 barrels per day, the API data showed. (Reporting by Aaron Sheldrick Editing by Joseph Radford)

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