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Oil Rebounds After US Crude Inventories Post Smaller-Than-Expected Bump

February 14, 2018 at 17:58 by Andrew Moran

Oil futures pared their early-morning losses after a new US government report found that domestic crude stockpiles posted a smaller-than-expected increase. US crude prices are looking to climb back above $60, while Brent crude is trying to muster up a rally.

March West Texas Intermediate (WTI) crude futures rose $0.21, or 0.35%, to $59.40 per barrel at 16:38 GMT on the New York Mercantile Exchange.

Brent, the international benchmark for oil prices, is also in the green midweek. April Brent crude futures jumped $0.35, or 0.56%, to $63.07 a barrel on London’s ICE Futures exchange.

Crude prices benefited from a weaker US dollar as the greenback shed 0.47% to 89.31.

According to the US Energy Information Administration (EIA), domestic crude stockpiles advanced by 1.8 million barrels, while US output topped 10.27 million barrels per day (bpd). Gasoline supplies climbed by 3.6 million barrels, while distillate stocks increased 500,000 barrels.

US production rose above 10 million bpd last month, surpassing Saudi Arabia, and it could soon top Russia. Thanks to the shale revolution of the last five years, the US is producing record amounts of oil.

On Wednesday, the International Energy Agency (IEA) reported that demand grew at a pace of 1.6 million bpd last year, and it boosted its growth forecast for global demand this year to 1.4 million bpd, up from 1.3 million. This is in line with Organization of Petroleum Exporting Countries (OPEC) figures that showed demand hitting 1.59 million bpd in 2017.

In other energy markets, March natural gas futures dipped $0.011, or 0.42%, to $2.583 per million British thermal units (btu), and March gasoline futures tumbled $0.004, or 0.24%, to $2.587 a gallon. March heating oil futures rose $0.019, or 1.03%, to $1.855 per gallon.

Refiners operated at 89.8% of operable capacity, which is less the market forecast of 91.1%.

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