09:10 AM EST, 11/05/2025 (MT Newswires) -- Oil prices weakened for a second session early on Wednesday as a report showed an unexpected surge in U.S. oil inventories, keeping demand and over-supply concerns top of mind for traders.

West Texas Intermediate crude oil for December delivery was last seen down US$0.24 to US$60.32 per barrel, while January Brent oil was down US$0.24 to US$64.20.

In its weekly survey, the American Petroleum Institute said U.S. oil inventories rose by 6.5-million barrels last week, while the consensus estimate expected a drop of 2.4-million barrels, according to Investing.com. The Energy Information Administration will release official inventory data later on Wednesday morning.

"API data indicated the largest US crude inventory build in more than three months, with stockpiles rising by 6.5 million barrels last week. If confirmed by the EIA later today, it would mark the biggest gain since late July," Saxo Bank noted.

The unexpected rise in stocks comes amid persistent warnings the oil market is oversupplied as rising production from OPEC+ and Western Hemisphere producers climbs above demand growth. The concerns were amplified by OPEC+'s weekend decision to hike supply for a third month by 137,000 barrels per day in December, following on the September end to the return of 2.2-million bpd of production cuts.

Rising output comes as the global economy slows with U.S. tariff policies hampering global trade and cutting into demand. Economic data this week showed slowing manufacturing activity in the United States, China and Japan, pushing investors away from over-heated risk assets.

"Japan's manufacturing sector shrank at its fastest pace in 19 months. Tepid new orders in the US led to the eighth consecutive monthly contraction in factory activity. A private survey reached the same conclusion in China, where expansion slowed last month, while manufacturers across other Asian economies are clearly feeling the impact of US tariffs in the form of declining orders," PVM Oil Associates noted.

Still, concerns over Russian supply is offering support for the commodity, as Ukraine continues its strikes on Russian oil infrastructure. Reports said Ukrainian drones on Tuesday struck at a Lukoil oil refinery in Russia, the second attack on Russian refineries this week, while Russia suspended exports from its main Black Sea oil export port following a Ukrainian attack.