2024.01.1009:10:00UTC+00Oil Edges Lower As EIA Predicts Record US Crude Production

Oil prices were moving lower on Wednesday after rising sharply in the previous session on the back of increased geopolitical tensions and industry data showing a decline in crude inventories in the U.S.

Benchmark Brent crude future dipped 0.6 percent to $77.10 a barrel while WTI crude futures were down 0.7 percent at $71.75.

Middle East worries persisted as Israel intensified bombing and ground incursions in central and southern Gaza with dozens killed in overnight attacks.

Meanwhile, data from the American Petroleum Institute, released late Tuesday, showed a larger-than-expected 5.2 million barrels decline in U.S. crude oil inventories in the week to January 5.

At the same time, another week of large builds in gasoline and distillates inventories stoked concerns over demand from the world's largest fuel consumer.

U.S. crude production will hit records over the next two years but grow at a slower rate, the U.S. Energy Information Administration (EIA) said in a report.

"Heightened tensions around the critical Red Sea shipping channel and other developments in the Middle East have added upward price pressure since early December and have the potential to disrupt global oil trade flows and drive up global oil prices further should they escalate or persist," the EIA said.