Oil prices dip as inventory build drags

By Henning Gloystein

SINGAPORE (Reuters) - Crude futures dipped slightly on Wednesday as ballooning U.S. storage volumes continued to pressure prices although relatively healthy demand figures from Europe supported prices.

Brent oil futures were trading at $55.09 a barrel at 0354 GMT, down two cents, while U.S. WTI crude was at $47.40 a barrel, down 11 cents.

Strengthening European manufacturing data - and the implication of greater energy demand - lent prices some support even as the expectation of further stock builds in the United States weighed on oil markets.

"Another week, another record U.S. commercial stock level," said U.S.-based PIRA Energy.

A poll of eight analysts - taken ahead of weekly reports from industry group the American Petroleum Institute (API) and the U.S. Energy Information Administration (EIA) - forecast a crude stock build of 5.1 million barrels on average last week.

The API report on Tuesday showed a slightly smaller build in U.S. crude stocks at 4.8 million barrels for last week. Any build from the more closely watched EIA figures due out later on Wednesday would confirm U.S. crude stockpiles have hit a record for the eleventh straight week.

In Japan, commercial weekly crude stocks were down 2.8 percent to 82.87 million barrels. The year-on-year change was a drop of nearly 8 percent.

(Editing by Joseph Radford and Tom Hogue)