A robust New York state factory report coupled with relatively bullish U.S. inventory figures sent oil prices gaining on Wednesday on hopes demand may be picking up in the world''s largest consumer of crude.
On the New York Mercantile Exchange, West Texas Intermediate crude for delivery in March traded at USD94.64 a barrel during U.S. trading, up 2.00%. New York-traded oil futures hit a session low of USD92.63 a barrel and a high of USD94.72 a barrel.
The March contract settled up 0.84% at USD92.01 a barrel on Tuesday. Nymex oil futures were likely to find support at USD91.65 a barrel, Monday''s low, and resistance at USD95.73 a barrel, the high from Jan. 3.
The Federal Reserve Bank of New York said that its general business conditions index jumped to 12.51 in January from an upwardly revised 2.22 in December. Analysts were expecting the index to rise to only 3.75.
Elsewhere, U.S. wholesale prices beat expectations and firmed oil prices further by painting a picture of a more robust economy, one that will demand more fuel and energy going forward.
The U.S. producer price index rose 0.4% in December, the biggest increase since June, recovering from a 0.1% decline in November and was 1.2% higher from a year earlier.
Core PPI was up 0.3% in December and rose 1.4% on a year-over year basis, compared to expectations for a monthly increase of 0.1% and an annual gain of 1.3%.
Supply data sent prices gaining as well.
The U.S. Energy Information Administration said in its weekly report that U.S. crude oil inventories fell by 7.66 million barrels in the week ended Jan. 10, well above expectations for a decline of 613,000 barrels.
Total U.S. crude oil inventories stood at 350.2 million barrels as of last week.
The report also showed that total motor gasoline inventories increased by 6.18 million barrels, above expectations for a gain of 2.54 million barrels.
Elsewhere, on the ICE Futures Exchange in London, Brent oil futures for March delivery were up 0.74% and trading at USD106.38 a barrel, while the spread between the Brent and U.S. crude contracts stood at USD11.74 a barrel.
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