Brent oil prices rise above $60, buoyed by US stock drawdown

LONDON: Brent crude oil futures rose above $60 a barrel on Wednesday after industry data showed a larger-than-expected drop in US crude inventories, but lingering worries about a possible global recession capped gains. Brent crude LCOc1 had gained 26 cents, or 0.43 per cent, to $60.29 a barrel by 0900 GMT, after settling 0.5 per cent higher on Tuesday, while US crude CLc1 was up 3 cents, or 0.05 per cent, at $56.16 a barrel. US crude oil stocks fell by 3.5 million barrels in the week to August 16, data from industry group the American Petroleum Institute (API) showed on Tuesday. Analysts polled by Reuters had expected a fall of 1.9 million barrels.
“Crude prices should see support from a bullish API stockpile report that could signal the largest Cushing draw since February 2018, if the EIA validates it,” said Edward Moya, senior market analyst at OANDA in New York, referring to the draw on inventories at Cushing, Oklahoma, the delivery point for US crude futures. Inventory numbers from the government’s Energy Information Administration (EIA) are due at 10:30 am EDT (1430 GMT) and will be more closely watched than usual given the nearing of the end of peak US driving season, analysts said.
“Private oil inventory data in the US showed a medium-sized draw on crude last week, which was only partly counterbalanced by product storage increases and continues to hint at tight crude fundamentals,” JBC Energy wrote in a note.
Oil prices were also supported by data showing lower exports in June from Saudi Arabia, the world’s top oil exporter.
Saudi Arabia plans to keep its crude exports below 7 million barrels per day (bpd) in August and September despite strong demand from customers to bring the market back to balance, a Saudi oil official said earlier this month. — Reuters