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Oil jumps 4% on lower U.S. stocks, firmer demand

REUTERS/Christian Hartmann

Oil prices climbed more than 4% on Wednesday on signs of improving demand and a drawdown in U.S. crude inventories, but gains were capped by worries over the economic fallout from the coronavirus pandemic and weak refining margins.

Brent crude futures LCoc1 were up $1.38, or 3.98%, at $36.03 per barrel at 10:54 a.m. ET (1454 GMT) while U.S. West Texas Intermediate (WTI) July crude futures CLc1 were up $1.38, or 4.32%, at $33.34 a barrel. Both benchmarks rose more than 5% during the session.

The WTI June contract expired on Tuesday at $32.50 a barrel, up 2.1%, avoiding the chaos of last month’s May expiry, when prices sank well below zero, as storage across the U.S. filled rapidly.

U.S. crude inventories fell by 5 million barrels in the week to May 15 to 526.5 million barrels, Energy Information Administration data showed, compared with analysts’ expectations in a Reuters poll for a 1.2 million-barrel rise. [EIA/S]

Crude stocks at the Cushing, Oklahoma, delivery hub fell by 5.6 million barrels in the last week, EIA said.

20 May 2020

News Source Reuters

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