Oil Prices Slip Ahead of U.S. Supply Update

Oil prices were a bit lower in European trade on Wednesday, as investors looked ahead to weekly data from the U.S. on stockpiles of crude and refined products later in the global day.

The U.S. West Texas Intermediate crude August contract was at $46.36 a barrel by 3:39AM ET (0730GMT), down 4 cents, or around 0.1%. It touched its highest since July 5 at $47.14 in the prior session.

Elsewhere, Brent oil for September delivery on the ICE Futures Exchange in London dipped 4 cents to $48.80 a barrel, after touching a two-week peak of $49.41 a day earlier.

The U.S. Energy Information Administration will release its official weekly oil supplies report at 10:30AM ET (1430GMT).

Analysts expect crude oil inventories dropped by around 3.2 million barrels at the end of last week, while gasoline supplies are seen decreasing by 655,000 barrels and distillates are forecast to gain about 1.2 million barrels.

After markets closed Tuesday, the American Petroleum Institute said that U.S. oil inventories rose by 1.6 million barrels in the week ended July 14. The API report also showed a sizable decline of 5.5 million barrels in gasoline stocks, while distillate stocks rose by 2.9 million barrels.

There are often sharp divergences between the API estimates and the official figures from EIA.

Oil prices finished higher on Tuesday, boosted by speculation of possible output curbs in Libya after the head of Libya's National Oil Corporation said he plans to attend a meeting of global crude producers in Russia on July 22 to share his country's production plans.

In May, OPEC and some non-OPEC producers extended a deal to cut 1.8 million barrels per day in supply until March 2018. So far, the agreement has had little impact on global inventory levels due to rising supply from producers not participating in the accord, such as Libya and Nigeria.

Elsewhere on Nymex, gasoline futures for August was little changed at $1.588 a gallon, while August heating oil held steady at $1.512 a gallon.

Natural gas futures for August delivery shed 0.9 cents to $3.079 per million British thermal units.