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Crude Oil Gains After Bigger-Than-Expected Decline of US Inventories

December 20, 2017 at 17:26 by Vladimir Vyun

Prices for crude oil rose today after the bigger-than-expected drop of US crude oil inventories. The Energy Information Administration reported that US stockpiles of crude shrank by 6.5 million barrels last week. The drop was almost two times the forecast decline of 3.6 million and the biggest in four months. Gasoline inventories rose, but the increase was modest, by 1.2 million barrels. Reserves at Cushing, Oklahoma, the key delivery hub for NYMEX crude, increased by 754,000 barrels last week.

Recently, the commodity got a new supportive factor in the form of an unexpected shutdown of the North Sea Forties pipeline — the major supply route for Brent crude. On a negative side, markets continued to worry that US oil production will counter attempts by the Organization of Petroleum Exporting Countries and several other major oil producers to reduce global surplus of crude.

February contract for delivery of WTI crude oil gained 0.64% to $57.93 per barrel as of 17:19 GMT on NYMEX today. Futures for Brent crude advanced by 0.63% to trade at $64.20 per barrel on ICE.

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