3 months ago
Commodities

U.S. Crude Oil Inventories Fell by 1.21M Barrels Last Week: EIA

Investing.com - U.S. crude oil inventories fell less than expected last week, the Energy Information Administration said in its weekly

Investing.com - U.S. crude oil inventories fell less than expected last week, the Energy Information Administration said in its weekly report on Wednesday.

The EIA data showed that crude oil inventories decreased by 1.21 million barrels in the week to Dec. 7.

That was compared to forecasts for a stockpile draw of 2.99 million barrels, after a drop of 7.32 million barrels in the previous week, amounting to a second straight weekly decline.

The EIA report also showed that gasoline inventories rose by 2.09 million barrels, compared to expectations for a build of 2.46 million barrels, while distillate stockpiles unexpectedly decreased by 1.48 million barrels, compared to forecasts for a gain of 1.80 million.

U.S. crude prices were trading up 0.72% to $52.02 a barrel by 10:34 AM ET (15:34 GMT), compared to $52.11 prior to the publication.

London-traded Brent crude futures gained 1.01% to $60.81 a barrel, compared to $60.86 ahead of the release.

Ahead of the release, oil prices had already been climbing after the American Petroleum Institute’s weekly report said on Tuesday that U.S. crude inventories fell by 10.2 million barrels last week.

Oil has also been supported this week by the supply loss in Libya, which declared force majeure on exports from the country's largest oilfield on Sunday after tribesmen and state security guards seized the facility.

The Libyan cutback follows last week's decision by the Organization of the Petroleum Exporting Countries and some non-OPEC producers including Russia to cut supply by 1.2 million barrels per day (bpd) for six months from Jan. 1.

"The OPEC+ deal from last week will allow more of a bullish position to be taken up by some market participants from this point," analysts at JBC Energy said in a report.

"The crude picture at least looks somewhat firmer for the next six months than it did previously."

While these supply cuts supported prices, a weaker economic outlook and higher production elsewhere kept gains in check.

"The global economy is set to cool in 2019-20, as rising interest rates and inflation begin to limit consumption in major developed economies," the Economist Intelligence Unit (EIU) said in its latest outlook.

Undermining the OPEC-led supply cuts is soaring output in the United States, which is set to end 2018 as the world's top oil producer, ahead of Russia and Saudi Arabia.

A shale revolution has helped the United States produce a record amount of oil this year.

-- Reuters contributed to this report