By Adedapo Adesanya
Oil prices settled lower on Wednesday despite positive data from the United States outweighed by other headwinds facing the market.
Brent crude futures lost $1.15 or 1.49 to finish at $76.05 per barrel at midweek and the US West Texas Intermediate (WTI) crude futures depreciated by $1.24 or 1.69 per cent to quote at $71.93 per barrel.
US employers added far fewer jobs than originally reported in the year through March, the Labour Department said on Wednesday.
The revised jobs data offset support from a drop in US oil inventories, and recently released minutes from the Federal Reserve indicating a likely September rate cut.
US crude stocks, gasoline and distillate inventories fell in the week ending August 16, the Energy Information Administration (EIA) said on Wednesday.
Crude inventories fell by 4.6 million barrels to 426 million barrels in the week, the EIA said.On Tuesday, the American Petroleum Institute reported another unexpected inventory increase, but a moderate one, at 347,000 barrels.
In fuels, the EIA also estimated draws in inventories.
Gasoline (petrol) inventories fell by 1.6 million barrels over the week to August 16, which compared with a draw of 2.9 million barrels for the previous week.
Gasoline production averaged 9.8 million barrels daily last week, which compared with 9.7 million barrels daily for the previous week.
In middle distillates, the authority reported an inventory draw of 3.3 million barrels for the week to August 16, which compared with a draw of 1.7 million barrels for the previous week.
Middle distillate production last week averaged 4.9 million barrels daily, which compared with 4.8 million barrels daily for te previous week.
Reuters reported that the Federal Reserves appear to be leaning toward an interest rate cut at their September policy meeting, and several would have been willing to reduce borrowing costs immediately, according to the minutes of the July 30-31 gathering.
Higher interest rates increase the cost of borrowing, which can slow economic activity and dampen demand for oil.
Meanwhile, hopes of a ceasefire in the Middle East also weighed on oil prices as they reduced the risk of a supply disruption, and the perception of weak Chinese demand remained stable.
Iran-aligned Houthi militants have continued to launch attacks on international shipping near Yemen since last November in solidarity with Palestinians in the war between Israel and Hamas.
The latest was a Greek-flagged oil tanker in the Red Sea on Wednesday facing repeated attacks that started a fire on the vessel and caused the ship to lose power. The Red Sea leading to the Suez Canal is a key shipping route for oil, and sustained attacks pose a potential threat to global crude flows.
