UPDATE 5-Oil dips after unexpected build in U.S. crude stockpiles

* U.S. crude stocks rise 2.6 million barrels last week - API
* U.S. govt oil inventory data delayed to Friday at 11
am/1600 GMT
OPEC+ compliance with oil cuts at 99% in December, sources say
* China's surging COVID-19 cases cast doubts on demand
outlook

(Updates prices, market activity, adds commentary; changes
byline, dateline, previous LONDON)
By Stephanie Kelly
NEW YORK, Jan 21 (Reuters) - Oil prices slipped on Thursday
after industry data showed a surprise increase in U.S. crude
inventories that revived pandemic-related fuel demand concerns,
while U.S. stimulus hopes buoyed prices.
Brent crude LCOc1 futures fell 3 cents to $56.05 a barrel
by 11:27 a.m. EST (1627 GMT). U.S. West Texas Intermediate (WTI)
crude CLc1 futures fell 14 cents to $53.17 a barrel.
Both benchmarks rose over the past two days on expectations
of massive COVID-19 relief spending under new U.S. President Joe
Biden.
Late Wednesday, industry data showed U.S. crude oil
inventories rose 2.6 million barrels last week, compared with
analysts' forecasts in a Reuters poll for a 1.2 million-barrel
draw. API/S
Official inventory data has been delayed by two days to
Friday due to the Martin Luther King Jr. holiday and
Inauguration Day.
"We are on pause until we get the inventory report," said
Phil Flynn, senior analyst at Price Futures Group in Chicago.
"The market is waiting to see what we're going to see in
inventories tomorrow and stimulus down the road."
Elsewhere, compliance with a deal to cut output from the
Organization of the Petroleum Exporting Countries and its allies
fell in December from November. Compliance reached 99% last
month, two sources told Reuters. Meanwhile, rising coronavirus cases in China, the world's
largest crude oil importer, weighed on prices.
Beijing plans to impose strict virus testing requirements
during the Lunar New Year holiday season, when tens of millions
of people are expected to travel, as it battles the worst wave
of new infections since March 2020. The commercial hub of Shanghai reported its first locally
transmitted cases in two months on Thursday. Longer term, the Biden administration could be bearish for
oil.
Among his first actions as president, Joe Biden announced
America's return to the Paris climate accord to combat climate
change and revoked a permit for the Keystone XL oil pipeline
project from Canada. The administration is also committed to ending new oil and
gas leasing on federal lands. The markets will also follow expected U.S. efforts to
strengthen nuclear constraints on oil producer Iran through
diplomacy. It will raise the issue in early talks with foreign
counterparts and allies, the White House said.