Oil rises as U.S. oil stockpiles drop, new Chinese COVID-19 cases decline

Oil prices climbed on Wednesday after industry data showed U.S. crude stockpiles fell unexpectedly last week and China, the world’s second-biggest oil user, reported its lowest daily rise in COVID-19 cases, bolstering hopes of a pick-up in demand. Brent crude futures climbed 19 cents, or 0.3%, to $56.10 a barrel at 0452 GMT, adding to a small gain on Tuesday. U.S. West Texas Intermediate (WTI) crude futures rose 20 cents, or 0.4%, to $52.81 a barrel, reversing Tuesday’s loss.

The American Petroleum Institute (API) reported crude oil inventories in the United States, the world’s biggest oil consumer, fell by 5.3 million barrels in the week to Jan. 22 compared with analysts’ expectations in a Reuters poll for a build of 430,000 barrels. However, the data showed gasoline stocks rose by 3.1 million barrels, which was much more than expected.

The API data showed distillate fuel inventories, which include diesel and heating oil, rose by 1.4 million barrels, compared to expectations for a draw of 361,000 barrels and refinery runs fell by 76,000 barrels per day. Having climbed to multi-month highs at the start of the year, the rally in oil prices appears to have run out of steam and has been range-bound in recent weeks, analysts said.

Oil rises as U.S. oil stockpiles drop, new Chinese COVID-19 cases decline, Reuters, Jan 27