Oil rises modestly as US crude stocks dwindle, according to Reuters

ছবি Photo from Reuters file: A petrol station attendant in Rome, Italy, prepares to make fuel in a car, January 4, 2012. Reuter / Max Ross

By David Gaffen

NEW YORK (Reuters) – Oil prices rose sharply on Wednesday, reserves rebounded from their first losses after an unexpected drop, and lists of the country’s largest storage sites hit a three-year low.

The futures rose 10 cents, or 0.1%, to 85 85.18 a barrel.

US West Texas Intermediate (WTI) crude for November delivery, ending Wednesday, rose 34 cents, or 0.4%, to 83 83.30 a barrel, while the WTI contract for December rose 22 cents, or 0.3%, to 82 82.66 a barrel.

The Organization of Petroleum Exporting Countries (OPEC) has maintained a slowdown in supply without intervening to add more barrels to the market, and crude prices have risen as supply has tightened as US demand has increased.

U.S. crude stock fell 431,000 barrels in recent weeks, and gasoline stocks fell more than 5 million barrels as processing stopped due to refiner maintenance, the U.S. Energy Information Administration said in a statement. [EIA/S]

U.S. stocks at Cushing, Oklahoma Delivery Hub reached their lowest level since October 2018, the EIA said. Petrol stocks are now at their lowest since November 2019.

“Strong demand and concerns about declining inventories when refiners are already running low during the maintenance season are what will happen when refineries increase production to meet the very strong demand for petrol and distillate,” said Phil Flynn of the Chicago Price Futures Group.

The market softened overnight after the Chinese government stepped up efforts to control high coal prices and ensure that coal mines run at full capacity to address Beijing’s power shortages.

Oil prices have risen in part and global coal prices have risen in anticipation that power producers could turn to oil for power supply.

Saudi Arabia’s energy minister says gas to oil users can meet demand of 500,000-600,000 barrels per day, depending on winter weather and prices from other sources of energy.

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