UPDATE 8-Oil falls to below $30/bbl as glut grows, output cuts eyed

* U.S. crude stockpiles rise 4.6 million barrels last week -
EIA
* Iraq emerges as OPEC's main laggard in output cut -
sources
* Russian oil output falls near to OPEC+ target - sources
* German government, states agree on way to ease lockdown

(New throughout, adds settlement prices)
By Jessica Resnick-Ault
NEW YORK, May 6 (Reuters) - Oil dropped 4% to below $30 a
barrel on Wednesday as U.S. crude stockpiles ticked up and
diesel inventories swelled, offsetting OPEC-led cuts in
production and hopes for a recovery in demand as some countries
ease coronavirus lockdowns.
Brent LCOc1 settled down $1.25, or 4%, at $29.72 a barrel,
the first loss after six consecutive sessions of gains. West
Texas Intermediate (WTI) crude CLc1 fell 57 cents a barrel to
$23.99.
Brent crude has almost doubled since hitting a 21-year low
on April 22. But the market was cautiously eyeing a deal led by
the Organization of the Petroleum Exporting Countries to cut
output by a record 9.7 million barrels per day from May 1,
equivalent to about 10% of world demand before the coronavirus
crisis led to a slide in consumption and prices.
Iraq has yet to inform its regular oil buyers of cuts to its
exports, suggesting it is struggling to fully implement the
OPEC deal with Russia and other producers on a record supply
cut, traders and industry sources said. Less than full compliance by Iraq, as well as by smaller
producers such as Nigeria and Angola, could hurt the OPEC+
group's efforts, even as Russia's output in the first five days
of May fell close to its production target, two sources familiar
with the data told Reuters.
Signalling a slow recovery in demand, data from the Energy
Information Administration showed U.S. crude and distillate
inventories rose last week.
Crude inventories USOILC=ECI rose for a 15th week in a
row, increasing by 4.6 million barrels, the EIA said, which was
less than analysts' expectations in a Reuters poll for a 7.8
million-barrel rise. EIA/S
"That smallish crude oil build was certainly supportive, but
there are still problems facing the market in this report," said
John Kilduff, a partner at Again Capital in New York. "That huge
build in distillates shows that the impact from a lack of
airline traffic and over-the-road truck traffic, so that doesn't
speak well about the economy and demand going forward."
Gasoline demand is also far below year-ago levels.
In April, global oil demand was expected to collapse by at
least 20%, an unprecedented drop, as governments told people to
stay at home.
Investors hope for a recovery now that Italy, Spain, Nigeria
and India as well as some U.S. states have started to allow some
people to go back to work and opened up construction sites,
parks and libraries.
Germany's federal government and 16 states have agreed on
ways to relax the lockdown. For now though, soaring inventories are a reminder of excess
supply lingering in the market.
"We would tend to agree that the market has bottomed out,
but would caution against getting overly excited about this,"
said analysts at JBC Energy. "The data trundling in for April
really is shockingly bad."