Home Stock Market Oil prices rose after industry data showed a decline in crude inventories

Oil prices rose after industry data showed a decline in crude inventories


Oil futures rose on Wednesday, finding support after an industrial trading group reported a drop in US crude inventories ahead of official government data on domestic stocks.

West Texas Intermediate crude for May delivery
CL.1,
+ 0.66%

CLK21,
+ 0.66%

up 50 cents, or 0,%, to $ 59.83 / barrel on the New York Mercantile Exchange. June Brent crude oil
BRN00,
+ 0.73%

BRNM21,
+ 0.73%
,
global standards, up 61 cents, or 1%, to $ 63.35 / barrel on ICE Futures Europe.

American Petroleum Institute late on Tuesday reported that the US crude oil supply down 2.6 million barrels for the week ending April 2, according to sources. Data also showed gasoline inventories increased by nearly 4.6 million barrels, while distillate stocks rose 2.8 million barrels. Meanwhile, crude stocks in Cushing, Oklahoma, the central reserve, were little changed, down 84,000 barrels for the week, sources said.

More closely watched inventory data from the Energy Information Administration will be released on Wednesday. The EIA is expected to see a 700,000 barrel drop in crude oil inventories, according to IHS Markit. It also forecasts a 200,000-barrel increase in inventories for gasoline and 500,000 barrels of distillate.

Fawad Razaqzada, market analyst at ThinkMarkets, said oil has been trading in a narrow range for the past two and a half weeks as traders weighed on signs of a strengthening US economic recovery to the economic health. Business and consumption stagnation persisted across the eurozone, said Fawad Razaqzada, market analyst at ThinkMarkets.

“The demand for oil will increase as door locks are gradually removed and many countries ease travel restrictions, while the vaccine rollout still promises an end to the pandemic,” he said. he said. However, concern is that an increase in demand will be offset by increased oil supplies as the Organization of the Petroleum Exporting Countries and its allies, known as OPEC +, have agreed to begin. Relaxed output restrictions last week, while indirect talks between the US and Iran could see sanctions against Tehran finally lifted.

See: What Iran nuclear talks mean for oil prices

“So I cannot see any significant increase in oil prices. Brent has been struggling to stay above $ 70 and WTI can’t stay above $ 65 for long, ”he wrote. “These will remain important resistance levels in the future and if the price bounces back I can’t see them hold above these levels for too long in 2021.”

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