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Oil futures traded higher Wednesday, after a trade group reported a fall in U.S. inventories last week. Support was also tied to reports the Organization of the Petroleum Exporting Countries is weighing an extension of their current agreement on production curbs.
West Texas Intermediate crude for March delivery CLH20, +0.60% on the New York Mercantile Exchange rose 32 cents, or 0.6%, to $53.80 a barrel, while April Brent crude BRNJ20, +0.61% was up 38 cents, or 0.6%, at $59.19 a barrel. Crude broke a five-day losing streak that had sent futures to three-month lows, with weakness tied in part to worries over the spread of the coronavirus that originated in China.
“Following a tough week in the oil markets, in which fears over the coronavirus in China could disrupt supplies, markets have risen for a second day on Wednesday as investors await on the economic impact it has had,” said Mihir Kapadia, chief executive of Sun Global Investments, in a note.
Kapadia and other analysts said support was tied in part to weekly inventory data from the American Petroleum Institute late Tuesday. API said U.S. crude supplies fell by 4.3 million barrels for the week ended Jan. 24, according to people familiar with the report. They said the data also showed gasoline stockpiles rose 3.3 million barrels, while distillate stocks were down 141,000 barrels.
More closely watched data from the Energy Information Administration is due Wednesday morning. Analysts surveyed by Platts expect crude inventories to rise 1.4 million barrels, while gasoline stocks are seen up 1.7 million barrels and distillates are projected to fall by 1.6 million barrels.
Crude was boosted Tuesday after news reports said concerns about the coronavirus were fueling talk among OPEC producers and their allies about output curbs. Reuters reported that OPEC wants to extend current oil output cuts, which are set to run through the end of March, until at least June.
In other energy trading, March gasoline RBH20, +1.02% rose 1.1% to $1.5304 a gallon, while March heating oil HOH20, +0.30% was up 0.4% at $1.7225 a gallon.
March natural-gas futures NGH20, -0.73% were off 0.7% at $1.894 per million British thermal units.
