Futures Movers: Oil prices rise on signs of falling U.S. inventories
Oil prices rose Wednesday after data from an industry group showed a decline in U.S. crude supplies, putting traders on watch for an official reading due later in the day.
Futures, especially for Brent, were also supported by a major pipeline outage in Europe.
West Texas Intermediate crude for delivery in January CLF8, +0.77% on the New York Mercantile Exchange was recently up 39 cents, or 0.7%, to $ 57.53 a barrel. February Brent LCOG8, +0.98% rose 53 cents, or 0.8%, to $ 63.87 a barrel.
The American Petroleum Institute, an industry group, said late Tuesday that its own data for the week showed a 7.4-million-barrel decrease in crude supplies, a 2.3-million-barrel rise in gasoline stocks and a 1.5-million-barrel rise in distillate inventories, according to a market participant.
The U.S. Energy Information Administration will issue a weekly update on domestic petroleum supplies on Wednesday morning. The OPEC monthly oil market report is also scheduled for release in the morning.
Analysts surveyed by S&P Global Platts expect the EIA report to reveal a decline of 4 million barrels in crude stockpiles for the week ended Dec. 8. Supplies of gasoline are expected to have climbed by 1.6 million barrels, while distillates are seen up by 500,000 barrels.
Prices for Brent crude oil, the global benchmark, pulled back Tuesday after rallying to a 2½-year high following news that a major North Sea pipeline would be shut down for weeks.
Read: North Sea pipeline shutdown puts oil traders on edge
Multinational chemicals group Ineos announced Monday that it was shutting its Forties Pipeline System (FPS). It would be closed for a “matter of weeks rather than days” after a hairline fracture discovered last week grew, it said Tuesday. The system delivers almost 40% of the U.K.’s North Sea oil and gas.
In a note Tuesday, Fiona Cincotta, senior market analyst at City Index, said “given that the market [has] been given a timeline of a few weeks for the closure, there is a good chance that the resultant upside for Brent could be capped.”
The OPEC monthly oil market report is scheduled for release on Wednesday
— Lucy Cramer and Myra P. Saefong contributed to this report.