Oil trending down

Oil continues to fall as U.S. inventories and Middle East tensions weigh. Oil fell to near its lowest level since mid-March as a slightly downward U.S. inventory report and tensions in the Middle East became the focus. Brent fell below $83 a barrel on Tuesday after falling to its lowest level since March 13, while U.S. crude fell to $78. Crude inventories in Cushing, Oklahoma, rose by more than 1 million barrels last week, according to people familiar with the figures, the American Petroleum Institute estimated. That also reflected higher gasoline and distillate inventories nationwide. Official data is due later Wednesday. In the Middle East, the Israeli army advanced toward Rafah, a city in Gaza. Oil has been trending lower since early April and has lost three of the past four weeks. While there is weakness amid rising inventories and diminishing geopolitical threats, “there is support from ongoing supply-side risks. We think markets are underpricing these risks in the near term,” said Han Zhong Liang, investment strategist at Standard Chartered, citing factors such as the OPEC+ meeting in June and renewed restrictions on Iranian and Venezuelan oil. The Organization of the Petroleum Exporting Countries meets next month to assess supply policy after imposing output cuts to support prices in the first half of the year. Most investors expect the restrictions to be extended until the end of the year, according to a Bloomberg survey.