KONTAN.CO.ID - LONDON. Oil prices dropped on Wednesday but stayed above $70 a barrel, taking a breather after recent days' strong rally as Mexico was set to resume crude production following a major outage. Brent crude fell 33 cents, or 0.46%, to $70.72 a barrel by 0904 GMT, while U.S. West Texas Intermediate (WTI) crude was down 40 cents, or 0.59%, to $67.14. Both benchmark contracts rose by about 8% over the previous two days. The rally erased most of the slump from a seven-day losing streak on the back of a resurgence in COVID-19 cases.
"A second consecutive day of price rally in the crude market had also spurred some profit-taking, while American Petroleum Institute data showing a less-than-expected decline in U.S. oil inventories last week added to the downward pressure," Vandana Hari said in a note to clients. Baca Juga: Gold slips on firm dollar, Fed symposium in focus Prices rallied in previous sessions after Mexican supply fell by more than 400,000 barrels per day after a fire on an oil platform. The state oil firm said it expected to resume production by Aug. 30. "Brent crude should remain fairly supported here despite today's weakness as the oil market is still heavily in deficit and that won't change anytime soon," Edward Moya, senior market analyst at OANDA, told Reuters. American Petroleum Institute data showed crude inventories fell 1.6 million barrels for the week ended Aug. 20, while gasoline stockpiles fell 1 million barrels, according to sources, who spoke on condition of anonymity. Analysts were expecting crude stockpiles to fall by 2.7 million barrel and gasoline stocks to drop by 1.6 million barrels, according to a Reuters poll.