Oil stuck in a range as US supply overshadows OPEC cuts

Oil prices traded on a weaker note this Wednesday morning and have been restricted to a narrow range since early January as OPEC-led cuts are being countered by the rise in the US oil supplies.

At the time of writing, Brent was trading 20 cents lower at $55.38/barrel. Brent has been trading in the sideways manner in the range of $53 to $57. Across the pond, WTI oil was trading 14 cents lower at $52.67.

Oil found takers on Tuesday after a Reuters survey showed that OPEC's output fell by over 1 million bpd in January to 32.27 million bpd between December and January.

However, the optimism quickly faded away after the American Petroleum Institute (API) reported inventory build across the board. Oil inventories increased by 5.8 million barrels compared to the estimate of 3.06 million barrels.

The API also reported a 2.9-million-barrel build in gasoline inventories, and a 2.3-million-barrel build in distillates.