By Keith Wallis
SINGAPORE (Reuters) - Oil futures fell in Asian trade on Wednesday as profit-taking and concern over a larger-than-expected build in U.S. crude stocks outweighed a report that Russia and Saudi Arabia had reached consensus on an oil output cap.
Brent crude had dropped 27 cents to $44.42 a barrel as of 0207 GMT, after hitting a four-month high in the previous session, when it settled up $1.86, or 4.3 percent.
U.S. crude dropped 37 cents to $41.80 a barrel after settling up $1.81, or 4.48 percent, the day before.
A firmer U.S. dollar, which makes dollar-denominated commodities more expensive for holders of other currencies, also pressured prices.
"There are two things. There has been a fantastic rise in prices so I think in the Asian time zone there's been a little bit of profit-taking," said Jonathan Barratt, chief investment officer at Sydney's Ayers Alliance.
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"The second thing is that while we're waiting for more official inventory data, investors are thinking: 'Are prices warranted at these levels?'," he said.
Investors are also wary of the outcome of a producer meeting in Doha on April 17 that may lead to an oil output cap.
"Investors have been burned before that OPEC (the Organization of the Petroleum Exporting Countries) will do something - the fundamentals of that thought have shown to be made of sand," said Ben Le Brun, market analyst at Sydney's OptionsExpress.
That came as Russia and Saudi Arabia were reported to have reached a consensus on Tuesday about an oil output freeze, ahead of Sunday's meeting.
"There's no reason for a freeze when oil is at $50 a barrel. If oil prices move back to $35 a barrel there'll be rhetoric and action for an output cap; at $50 a barrel there'll just be rhetoric," Barratt said.
That came as China's crude imports rose 13.4 percent in the first quarter from a year ago, China customs data showed. Imports of oil products fell 1.9 percent in the first quarter
U.S. crude stocks rose by a larger than expected 6.2 million barrels to 536.3 million last week, data from industry group the American Petroleum Institute showed.
That compared with analyst expectations for a 1.9-million barrel increase.
Official inventory data is due later on Wednesday. [EIA/S]
U.S. crude production is forecast to fall by 560,000 barrels per day to 8.04 million barrels in 2017, while U.S. demand would increase by 190,000 bpd, according to the EIA's short term energy outlook published on Tuesday.
Global oil demand will grow by 1.16 million barrels per day this year, a 10,000-barrel rise compared with earlier estimates, the EIA said in its monthly forecast.
The agency raised its oil demand growth estimate for 2017 by 120,000 bpd to 1.33 million bpd.
(Reporting by Keith Wallis; Editing by Joseph Radford and Ed Davies)