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Brent clings to gain but US oil suffers after inventory surge

Brent crude rose close to $110 a barrel on Wednesday due to mounting tensions in Ukraine, while prices for U.S. oil fell after a report showed a huge build in stockpiles in the world's largest oil consumer.

Ukrainian government forces and separatist pro-Russian militia staged rival shows of force in eastern Ukraine amid escalating rhetoric on the eve of crucial talks on the former Soviet state's future. Brent has been buoyed by the tensions between Kiev and pro-Russian separatists in the east of the country.

Meanwhile, growing oil stockpiles in the United States have pulled benchmark prices there lower, as production hit the highest level in more than a quarter of a century, and imports continued to rise.

Pump jacks and wells are seen in an oil field on the Monterey Shale formation where gas and oil extraction using hydraulic fracturing, or fracking, is on the verge of a boom, March 23, 2014 near McKittrick, California.
Getty Images
Pump jacks and wells are seen in an oil field on the Monterey Shale formation where gas and oil extraction using hydraulic fracturing, or fracking, is on the verge of a boom, March 23, 2014 near McKittrick, California.

Brent crude for June delivery rose by a dollar earlier in the session but pared gains to trade up 40 cents under $110 a barrel, its highest level since March 4. The May contract expired on Tuesday. U.S. crude for May delivery rose a penny to settle at $103.760 a barrel. U.S. oil was up more than $1 before the EIA inventory report.

Crude oil stocks rose 10 million barrels to 394 million barrels in the week ending April 11, according to the Energy Information Administration (EIA), far more than the 2.3-million-barrel build expected by analysts. Inventories were boosted in part by a 5.2-million-barrel build on the Gulf Coast, to the highest level since the EIA began collecting data in 1990.

Growing scepticism that Libyan exports can resume quickly or sustainably has also supported Brent. A tanker started loading at Libya's eastern port of Hariga on Wednesday for the first time in nearly nine months, after a federalist group agreed to reopen the port last week.

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Symbol
Price
 
Change
%Change
BRENT
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OIL
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