“The report has been quickly viewed as bullish with the crude draw just about exactly opposite to what API had: a 3.4 million-barrel build”, said Dominick Chirichella, senior partner at the Energy Management Institute in NY, referring to the American Petroleum Institute data released late Tuesday.
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Traders said an expected increase in Canadian oil sands output following disruptions to over 1 million barrels of daily production capacity due to a wildfire was weighing on markets.
EIA data also showed that gasoline supplies fell by 1.2 million barrels, while distillate stockpiles were down 1.6 million barrels last week.
Brent crude rose 1.4 percent to $44.26 a barrel on London’s ICE Futures exchange.
Brent crude futures LCOc1 were up $1.60, or 3.6 per cent, at $45.23 per barrel by 1:35 p.m. EDT (1735 GMT).
While Sunday’s cooler weather, light rain and favourable winds helped control the advance of the blaze that razed neighbourhoods in Alberta’s oil sands boomtown, Fort McMurray, regional energy firms continued to shut facilities as a precaution, sending futures prices up 2 percent in early trading.
Monthly trading ranges, or the difference between the high and low closing oil prices in a given month, are another way of measuring volatility.
“A reversal in the US -dollar will continue to weigh on commodity markets”.
This is unexpected data to the market, as it is completely different from the inventory report released by the American Petroleum Institute.
“The market is close to balanced … when we consider the large amount of supply offline in Canada and elsewhere, which could last for months”, Morgan Stanley said. The official data from the EIA showed that crude stockpiles dropped by a “surprisingly large” 3.4 million barrels last week.
“The market has to be happy with these inventory numbers”, said Rob Haworth, a senior investment strategist in Seattle at U.S. Bank Wealth Management, which oversees $125 billion of assets.
The prices of crude oil across the world is taking a nose dive again, falling from 2016 highs to the mid-forties on Monday. Shell and Chevron have evacuated oil workers in the past few days due to a surge in attacks on oil facilities, according to Nigerian labour unions.
EIA expects the average monthly price for gasoline will peak at $2.28 per gallon in June and thento fall to $2.12 at the end of the summer driving season in September.
Middle East oil exporter Kuwait said that recent price rises were fundamentally justified.
Shares in Barratt Developments fell despite saying it improved its sales rate in the 19 weeks since the start of the year and confirmed market conditions remained “strong”.
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The appointment of a new Saudi oil minister “has made the June OPEC meeting less clear to investors, as the representative of the world’s most powerful producer of oil has mentioned that keeping output high is the best strategy for the kingdom”, Yang noted.
