Oil eases over demand worries ahead of OPEC+ meeting

Oil prices fell about 1% in early trade on Wednesday before paring some losses, ahead of a meeting OPEC+ producers on fears of a slowdown in global growth hitting fuel demand and a firmer dollar, Reuters.

Brent crude LCOc1 futures were last down 38 cents, or 0.4%, at $100.16 a barrel at 0345 GMT. West Texas Intermediate (WTI) crude CLc1 futures slid 35 cents, or 0.4%, to $94.07 a barrel.

The Organization of the Petroleum Exporting Countries and allies including Russia, together known as OPEC+, meet on Wednesday. OPEC+ sources told Reuters last week that the group will likely keep output unchanged in September, or raise it slightly.

A stronger dollar, bolstered by comments from U.S. Federal Reserve officials hinting at more interest rate hikes to cool inflation, also weighed on oil prices as a firmer greenback makes oil more expensive for holders of other currencies.

Adding to the bearish view on demand, data from the American Petroleum Institute, an industry group, showed U.S. crude stocks rose by about 2.2 million barrels for the week ended July 29, against analysts’ expectations for a decline of around 600,000 barrels.

Gasoline inventories fell by 200,000 barrels, which was a smaller drawdown than analysts had expected, however distillate stocks fell by about 350,000 barrels against analysts’ forecasts for a build.

The market will be looking to see if official data from the U.S. Energy Information Administration (EIA) at 1430 GMT confirms the inventory view.