Oil inches higher after data points to declining U.S. inventories
Oil prices were about 1 percent higher on Wednesday after a report showed U.S. refineries processed record amounts of crude in the latest week, eating into inventories, although a surprise jump in gasoline stockpiles limited price gains, APA reports quoting Reuters.
U.S. crude inventories USOILC=ECI fell 6.5 million barrels last week, government data showed, steeper than the expected decrease of 2.7 million barrels. Refiners processed nearly 17.6 million barrels of crude, surpassing a record set in May and the most for any week since the U.S. Department of Energy started keeping data in 1982. [EIA/S]
Brent crude LCOc1, the global benchmark, ended the session up 56 cents, or 1.1 percent, at $52.70, after two days of declines. U.S. West Texas Intermediate (WTI) crude CLc1 gained 39 cents, or 0.8 percent to settle at $49.56.
"A drop in crude oil imports and another step up in refinery utilization accounts for the bulk of the decline in crude inventories," said David Thompson, executive vice president at Powerhouse, an energy-specialized commodities broker in Washington, D.C..
"Demand for both gasoline and distillate fuels remains strong but it's worth noting that gasoline demand should be strong at this time of year and we are drawing closer to the end of summer driving season."
The data showed gasoline stocks USOILG=ECI, rose by 3.4 million barrels, confounding expectations in a Reuters poll for a drop of 1.5 million barrels as imports into the East Coast region picked up. Gasoline futures RBc1 fell about 1 percent to the lowest in nearly two weeks.
"Whilst the upside to imports into the U.S. East Coast remains limited amidst refinery issues in Europe, interest in shipping gasoline from the U.S. Gulf Coast into PADD 1 appears to have picked-up as we move into the transitioning period between summer and winter specifications," Energy Aspects said in a note.
From a technical perspective, $48.16-$48.37 a barrel region is a key zone of support for front-month WTI futures, Thompson said.
The drop in U.S. crude stocks also raised hopes that OPEC-led output cuts were helping wipe out a three-year global supply glut.
The Organization of the Petroleum Exporting Countries (OPEC), Russia and other producers are cutting output by about 1.8 million barrels per day (bpd) under a deal set to run until March 2018.
The deal has supported prices but an output recovery in Libya and Nigeria, OPEC members exempt from the cut, has complicated the effort. U.S. shale oil drillers have also ramped up production.
OPEC officials met this week in Abu Dhabi to boost adherence to the supply cuts. In a statement after the meeting, OPEC said the conclusions reached would boost compliance. Still, some analysts remained skeptical.
"The statement on the OPEC website following the Abu Dhabi meeting was short on substance," Vienna-based JBC Energy said.
Top OPEC exporter Saudi Arabia, keen to get rid of the glut, will cut crude allocations to customers in September by at least 520,000 bpd, an industry source said on Tuesday.
Related news releases
- 23.08.2017UN agencies offer emergency assistance to Iraqis fleeing Tal Afar
- 23.08.2017Maduro: Venezuela-US relations at ‘worst moment’
- 23.08.2017US talked to Russia, China about role in Afghan peace process - Tillerson
- 22.08.2017China urges U.S. to fix 'mistake' of sanctioning firms over North Korea
- 22.08.2017US backs Iraq’s territorial integrity: Defense minister
- 22.08.2017Unknown security threat causes lockdown at White House
- 22.08.2017Protesters storm Charlottesville city council meeting
- 22.08.2017U.S., North Korea clash at U.N. forum over nuclear weapons
- 22.08.2017US adds 4 Russian nationals in sanctions list
- 22.08.2017Trump: No timetable for Afghan troop withdrawal
- 21.08.2017Secret Service budget takes blow protecting Trump
- 20.08.2017Second officer dies in Florida police shooting
- 20.08.2017Veteran NAFTA negotiators likely to deflect political pressures
- 20.08.2017Counterprotest derails 'free speech' rally in US city
- 19.08.2017Boston march against right-wing rally draws thousands
- 19.08.2017Earthquake of 6.4 magnitude strikes west of Tonga
- 19.08.2017US has no intention to stay in Syria: State Dept
- 19.08.2017Romania negotiating to buy U.S. rocket systems worth $1.25 billion: Pentagon
- 19.08.2017U.S. State Department email restored after global outage
- 19.08.2017Oil jumps 3 percent as dollar falls, U.S. rig count drops
- 18.08.2017Rare US solar eclipse to help unlock sun's secrets
- 18.08.2017Trump fires adviser Bannon
- 18.08.2017UN Security Council condemns Barcelona terrorist attack
- 17.08.2017White House chief of staff briefs Trump on Barcelona incident
- 17.08.2017At least 13 dead in terror attack in Barcelona - UPDATED - VIDEO
- 17.08.2017Clashes at Venezuelan Prison Kill 37 Inmates, Wound 4
- 17.08.2017At least six killed in suspected gang attack at Guatemala hospital
- 17.08.2017Mike Pence urges four South American nations to cut contacts with North Korea
- 17.08.2017US Black Hawk missing in Hawaii, search underway for crew
- 17.08.2017Trump ends business councils after mass resignations
- 16.08.2017Explosion occurs at plaza Venezuela metro station in Caracas
- 16.08.2017Trump: Both sides to blame in Charlottesville violence
- 16.08.2017Colombia’s FARC to become political party with new name, same acronym
- 16.08.2017U.S. confident of 'peaceable' Venezuelan solution
- 16.08.2017US senator McCain urges Trump to promote free trade as NAFTA talks begin
- 15.08.2017U.S. sanctions hit Russian hopes of a 'Trump bump' for investment
- 15.08.2017Oil prices steady after overnight tumble on dollar strength
- 15.08.2017Venezuela's Maduro seeks to capitalize on Trump's military threat
- 15.08.2017Pence says 'failed state' in Venezuela threatens United States
- 15.08.2017Trump condemns KKK, neo-Nazis, white supremacists
- 10.08.2017Cuban diplomats expelled from US over mystery illness
- 10.08.2017Guam governor says 'no panic' on US pacific island over North Korea's threat
- 10.08.2017US strongly reacts to Putin's visit to Abkhazia
- 09.08.2017Pentagon chief issues stark warning to North Korea
- 09.08.2017US sanctions 22 Mexican individuals, 43 entities tied to drug gang
- 09.08.2017Trump boasts of U.S. nuclear power in warning to North Korea