U.S. crude futures dropped more than $1 in early trading on Thursday after unexpected data showed an increase in U.S. crude oil inventories, sparking concerns about potential oversupply.

An oil pumpjack is pictured in the Permian basin, Loco Hills regions, New Mexico, U.S., April 6, 2023.

By 2309 GMT, U.S. West Texas Intermediate (WTI) crude futures had fallen $1.21, or 1.9%, to $61.94. This decline followed a 0.8% drop on Wednesday.

Crude oil stockpiles rose by 3.5 million barrels, reaching 441.8 million barrels in the week ending May 9. This was in contrast to analysts' expectations, which had forecast a 1.1 million-barrel decrease, according to a Reuters poll. Additionally, data from the American Petroleum Institute (API) showed a significant increase in crude stocks, with a 4.3 million-barrel rise last week, as reported by market sources on Tuesday.

Meanwhile, OPEC+—a group consisting of the Organization of the Petroleum Exporting Countries and allied producers—has been increasing its oil supply. However, OPEC adjusted its forecast on Wednesday, lowering its projection for growth in oil supply from the United States and other non-OPEC+ producers this year.