Brent rose above $50 a barrel for the first time since July.
Advertisement
A supply glut coupled with lack of demand has weighed on oil prices in recent months.
US crude inventories fell 2.5 million barrels last week, the Energy Information Administration (EIA) announced, surprising analysts who had expected a build of 522,000 barrels.
Crude futures have surged after closing below $40 a barrel at the start of the month for the first time since April.
Some traders and investors cautioned that crude futures, which slipped into bear market territory in early August after falling 20 per cent from this year’s highs in June, were looking overbought.
U.S. West Texas Intermediate crude rose 84 cents, or 1.8 percent, to settle at $46.58.
USA light crude oil rose $1.09 to $47.88 per barrel, a 2.3% gain.
Over the last four weeks, crude oil imports averaged over 8.4 million barrels per day, an 11.3 percent increase compared to the same four-week period previous year.
Oil prices rallied for a sixth day in Asia today as markets were boosted by figures showing a decreasing United States stockpile.
Nigerian oil minister Emmanuel Ibe Kachikwu said on Thursday that while a cut in OPEC production is unlikely, there is hope a meeting of producers in Algeria next month could help shore up crude prices. “Prices are only marginally above where they were when the group met in Doha in April and couldn’t agree to a deal”, Australian bank ANZ said.
Analysts however, have said gains are being eroded by media reports that Saudi Arabia, OPEC’s top producer, is ramping up production to fresh record levels in August.
The market reaction followed a similar price boost on August 15 when Novak told a Saudi newspaper Asharq al-Awsat that Russian Federation would be willing to go along with a temporary production freeze.
Whatever the reading, analysts expect prices to fluctuate ahead of a September meeting in Algeria involving members and non-members of the Organization of the Petroleum Exporting Countries (OPEC).
Angus Nicholson, a Melbourne-based analyst with IG Markets, believes though, that Iran’s resistance “means little when the oil price has such strong upwards momentum”.
Advertisement
Saudi Arabia, meanwhile, has signalled that it could boost its crude oil supplies in August to a new record.
