08:53 AM EDT, 10/23/2024 (MT Newswires) -- Oil prices weakened early on Wednesday following two days of gains after a report showed a larger than expected rise in U.S. inventories last week and the dollar strengthened.

West Texas Intermediate crude for December delivery was last seen down US$1.20 to US$70.54 per barrel, while December Brent crude, the global benchmark, was down US$1.20 to US$74.84.

In its weekly survey released Tuesday, the American Petroleum Institute reported U.S oil stocks rose by 1.64-million barrels last week, while the consensus estimate from analysts polled by Reuters expected a rise of 0.3-million barrels. The Energy Information Administration will release official inventory data later on Wednesday morning.

Along with the rise in U.S. inventories, the drop comes as the dollar continues to appreciate, rising to the highest since late July ahead of the Nov.5 U.S. election, while China's flagging economy is depressing demand. Supply is also set to rise as OPEC+ plans to unwind 2.2-million barrels per day of voluntary production cuts with 180,000 bpd of monthly supply additions beginning in December.

"Crude oil remains in a wait-and-see mode ... supported by a continued focus on how an Israeli attack on Iran may impact supply and stability, while at the same time being held back by a stronger dollar. Focus is on the EIA's weekly inventory report after the API reported a 1.6 million barrel stock build," Saxo Bank noted.