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Oil futures rose Wednesday, lifted after an industry report showed U.S. crude inventories fell last week. Official government data on crude inventories is due later in the session.
Price action
-
West Texas Intermediate crude for February delivery
CL.1,
+2.46%
CL00,
+2.27%
CLG23,
+2.27%
rose $1.23, or 1.6%, to $77.46 a barrel on the New York Mercantile Exchange. -
February Brent crude
BRN00,
+2.14%
BRNG23,
+2.14% ,
the global benchmark, was up $1.36, or 1.7%, at $81.35 a barrel on ICE Futures Europe. -
Back on Nymex, January gasoline
RBF23,
+1.33%
rose 0.7% to $2.238 a gallon, while January heating oil
HOF23,
+2.97%
gained 1.7% to $3.109 a gallon. -
January natural gas
NGF23,
+4.37%
bounced 3.8% to $5.525 per million British thermal units after a roughly 24% drop over the previous three sessions.
Market drivers
The American Petroleum Institute said late Tuesday that U.S. crude inventories dropped 3.1 million barrels last week, according to a source citing the data. Gasoline inventories rose 4.5 million barrels, while distillate supplies were up 830,000 barrels. Official figures from the Energy Information Administration were due later Wednesday.
Analysts surveyed by S&P Global Commodity Insights, on average, expect crude inventories to show a rise of 600,000 barrels, while gasoline stocks are seen rising 1.6 million barrels and distillate supplies falling 400,000 barrels.
Crude has been lifted this week as investors weighed the demand implications of China’s relaxation of COVID curbs, analysts said. A surge in infections is seen curtailing activity in the short run,
“Specifically, despite skyrocketing cases and reports of stressed hospitals, Chinese authorities are not locking down cities and that implies continued increases in energy demand as the world’s second largest economy comes back online,” said analysts at Sevens Report Research, in a note.
“However, it remains to be seen how much that increased energy demand will be offset by what’s likely to be a slowing global economy and that’s why the China reopening hasn’t spurred a bigger rally in oil,” they wrote.
