By Enes Tunagur

LONDON, Aug 13 (Reuters) — Oil prices declined on Thursday as investors evaluated the prospect of weaker global demand this year alongside a substantial build in U.S. crude inventories. However, losses were partially cushioned by a lack of progress in negotiations over the blockaded Strait of Hormuz and ongoing supply disruptions.

Brent futures fell $1.54, or 1.7%, to $87.44 a barrel by 1140 GMT, paring gains accumulated over the previous six sessions. U.S. West Texas Intermediate (WTI) crude dropped $1.61, or 1.9%, to $81.66, retreating after five consecutive sessions of advances.

Giovanni Staunovo, an analyst at UBS, noted that the large U.S. crude build last week presents a headwind for prices, but added that the downside should remain limited as long as flows through the Strait of Hormuz stay depressed.

Data released on Wednesday by the Energy Information Administration (EIA) showed that U.S. commercial crude oil inventories posted their largest weekly increase since January 2023, driven by a slump in exports. Crude stockpiles rose by 17.4 million barrels to 424.4 million in the week ended August 7, reaching their highest level since June 5. A Reuters poll of analysts had anticipated a drawdown of 1.4 million barrels. The scale of the surprise build underscored how weakening export appetite is leaving more crude stranded in storage, reinforcing concerns that global consumption is softening even as supply risks persist.

Separately, OPEC revised down its world oil demand growth forecast for 2026 to 580,000 barrels per day in its monthly oil market report.

The International Energy Agency (IEA) said it now expects a contraction of 1.6 million barrels per day in consumption this year, compared with its previous forecast of a 1 million bpd decline issued last month. The agency attributed the steeper contraction to demand curtailment from higher prices and restricted supply resulting from the U.S.-Israeli war with Iran. The convergence of downward revisions from both OPEC and the IEA — two organizations that often differ in their demand assessments — added weight to the bearish demand narrative.

Supply disruptions across the Middle East and the Black Sea region continued to underpin prices. The United States and Iran have issued competing claims over the Strait of Hormuz, with the recently appointed head of Iran's Basij paramilitary unit stating on Thursday that the waterway is "under Iran's control and management." His remarks came a day after U.S. President Donald Trump asserted that the United States had "total control" of the strategic strait. The strait normally carries roughly a fifth of global oil consumption, making any sustained disruption a central variable for energy markets.

Vessel crossings through the Strait of Hormuz, excluding container ships, fell to five on Wednesday — their lowest level in three weeks, according to Kpler shipping data.

In other developments, Russia struck Ukraine's Izmail port area in the southern Odesa region overnight. Meanwhile, a drone attack ignited a fire in an industrial zone in Salavat, located in the Russian republic of Bashkortostan, which is home to a large oil refinery.

(Reporting by Sam Li in Beijing and Siyi Liu in Singapore; Editing by Mark Potter and David Goodman)