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Oil prices rise on expected U.S. stocks draw

Oil rises on big decline in U.S. crude stocks
Oil rises on big decline in U.S. crude stocks   -   Copyright  Thomson Reuters 2021   -  
By Reuters

<div> <p>By Dmitry Zhdannikov</p> <p><span class="caps">LONDON</span> -Oil prices climbed more than $1 on Wednesday, extending overnight gains after industry data showed U.S. crude stocks fell more than expected last week in the wake of two hurricanes, highlighting tight supply as demand improves. </p> <p>Prices were also supported as some <span class="caps">OPEC</span> members struggle to raise output and by a general sense of energy market shortages amid a power and gas crisis in Europe. </p> <p>U.S. West Texas Intermediate (<span class="caps">WTI</span>) crude futures rose $1.16, or 1.6%, to $71.65 a barrel by 1055 <span class="caps">GMT</span>, adding to a 35- cent gain from Tuesday. </p> <p>Brent crude futures climbed $1.08, or 1.4%, to $75.44 a barrel, after gaining 44 cents on Tuesday. </p> <p>The oil market’s focus turned to concerns of tight supply, after Monday’s pressure from broad market jitters over the possible default of Chinese property developer China Evergrande Group. </p> <p>“Crude is supported by the <span class="caps">API</span> weekly report, which noted a bigger-than-expected decline in U.S. crude oil stocks,” said Ravindra Rao, vice president of commodities at Kotak Securities. </p> <p>“Prices are still rangebound ahead of the <span class="caps">EIA</span> weekly report due later today and ahead of the U.S. Federal Reserve’s monetary policy decision … In the near term, crude may move with larger markets with focus on China and Fed policy.” </p> <p>U.S. crude stocks fell by 6.1 million barrels for the week ended Sept. 17, market sources said, citing Tuesday’s figures from the American Petroleum Institute. [API/S] </p> <p>That was a much bigger than the expected decline. The market will be watching U.S. government data on Wednesday to confirm the drops. [EIA/S] </p> <p>“Given the variety of supportive factors in the energy space, notably sky-high natural gas prices … dips in prices right now are likely to be short-lived,” said Jeffrey Halley, an analyst at brokerage <span class="caps">OANDA</span>. </p> <p>Global gas prices are expected to break records this winter.</p> </div>