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Crude Oil Gains as US Inventories Shrink

May 3, 2017 at 9:03 by Vladimir Vyun

Futures for crude oil gained today after the report from the American Petroleum Institute showed that US inventories of crude and gasoline shrank last week. Crude oil inventories were down by 4.2 million barrels, almost two times the forecast number. Stockpiles at the delivery hub in Cushing, Oklahoma, decreased by 215,000 barrels.

Now, traders wait from a supply report from the US Energy Information Administration. Experts predict that the data will show a drawdown of 3.3 million barrels.

Oil prices remained under pressure from concerns that increasing US oil output will hamper efforts of the Organization of Petroleum Exporting Countries to eliminate global glut. Additionally, there were worries about compliance to the production cut deal announced by the OPEC last month. Market participants were especially concerned that non-OPEC participants of the agreement, like Russia, are not going to fulfill their obligations. With that said, Bloomberg reported that according to an unnamed source Russia not only has reached its output cut target, but also is in favor of extending the existing deal.

June futures for delivery of WTI crude oil gained 0.69% to $47.99 per barrel as of 8:53 GMT on NYMEX today. July contract for delivery of Brent crude climbed 0.85% to $50.89 per barrel on ICE.

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