Oil prices gain more than 1% after bigger-than-expected inventory draw By Reuters


© Reuters. FILE PHOTO: The Bryan Mound Strategic Petroleum Reserve is seen in an aerial photograph over Freeport, Texas

By Aaron Sheldrick

TOKYO (Reuters) – Oil prices gained more than 1% on Wednesday, with rising for a seventh day, after industry data showed a bigger than expected drop in inventories and investors shrugged off worsening developments in the pandemic.

U.S. West Texas Intermediate (WTI) was up 67 cents, or 1.3%, at $53.88 a barrel by 0420 GMT after gaining nearly 2% on Tuesday. was up 79 cents, or 1.4%, at $57.37, having risen 1.7% in the previous session.

Both benchmarks are trading at the highest since February, before the coronavirus outbreak in China began spreading across the world and billions of people went into lockdown to prevent a pandemic that is now in a deadlier second wave.

Prices are shrugging off the latest developments in Europe and the United States where death tolls and new infections keep rising, with the focus on rollouts of vaccines, however patchy.

Even as China is grappling with its biggest coronavirus spike in months, comments from President Xi Jinping providing an upbeat assessment of the world’s second-biggest economy and biggest oil importer supported prices.

“Crude oil prices also continued to rally … on economic optimism in China after President’s Xi comments and an inventory report from API showed that crude oil inventories fell more than expected,” said Avtar Sandu, senior manager commodities at Phillip Futures.

Oil stocks in the U.S. dropped by 5.8 million barrels last week to around 484.5 million barrels, data from the American Petroleum Institute showed late on Tuesday. [API/S]

That was more than analysts’ expectations in a Reuters poll for a fall of 2.3 million barrels.

Still, falling inventories and rising oil prices are likely to tempt U.S. drillers back into the fray, especially as Saudi Arabia and other major producers cut their output, effectively ceding market share to American producers, analyst said.

Disclaimer: Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. All CFDs (stocks, indexes, futures) and Forex prices are not provided by exchanges but rather by market makers, and so prices may not be accurate and may differ from the actual market price, meaning prices are indicative and not appropriate for trading purposes. Therefore Fusion Media doesn`t bear any responsibility for any trading losses you might incur as a result of using this data.

Fusion Media or anyone involved with Fusion Media will not accept any liability for loss or damage as a result of reliance on the information including data, quotes, charts and buy/sell signals contained within this website. Please be fully informed regarding the risks and costs associated with trading the financial markets, it is one of the riskiest investment forms possible.





Source link

Leave a Reply

Your email address will not be published. Required fields are marked *