Crude oil futures pared gains in late trading Tuesday, after American Petroleum Institute data showed crude oil inventory had a larger-than usual weekly build, The Wall Street Journal reported.
US oil inventories increased by 11.4 million barrels in the latest week, an unnamed source told the Journal. U.S. government data on the weekly inventories is due Wednesday at 10:30 a.m. ET.
"This is a mega build As a result of refinery maintenance season. There can only be more weeks like this ahead. Inventories will only getlarger from here," said John Kilduff, partner with Again Capital. "We're going to see more fireworks."
Oil prices rose as much as 6 percent earlier Tuesday, sending both Brent and U.S. crude briefly above $32 a barrel, on hopes OPEC and non-OPEC producers were inching closer to a deal to reduce output in the face of one of the biggest supply gluts in decades.
The Organization of the Petroleum Exporting Countries has renewed calls for rival producers to cut supply alongside its members, but Russia, seen as key to any deal, has resisted so far.
But the oil minister of Iraq said on Tuesday OPEC kingpin Saudi Arabia and top non-OPEC producer Russia are showing signs of flexibility about agreeing to tackle an oil glut that has pushed prices to 12-year lows.
"We have seen some flexibility from the brothers in Saudi and a change in tone from Russia," Adel Abdel Mahdi, whose country is the second-largest producer in the Organization of the Petroleum Exporting Countries, said.