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NYMEX crude oil gains on falling U.S. stockpiles

Published 01/15/2014, 07:05 PM
Updated 01/15/2014, 07:36 PM
Investing.com – Crude oil prices rose during Asian trading hours on Thursday after an unexpectedly large drop in the U.S. crude oil stockpiles.
 
According to the Energy Information Administration report released late on Wednesday, the U.S. stockpiles in the week ending Jan.10 fell by 7.66 million barrels to 350.2 million barrels. Analysts had expected a drop of only 0.613 million barrels as in the week earlier they had dropped by 2.68 million barrels.
 
On the New York Mercantile Exchange, West Texas Intermediate crude for delivery in March traded at USD94.48 a barrel during Asian trading, up 0.13%.
 
On Wednesday, the New York-traded oil futures hit a session low of USD94.44 a barrel, a high of USD94.62 a barrel and settled at USD94.35 a barrel. 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.
 
Earlier on Wednesday, a robust New York state factory report coupled with relatively bullish U.S. inventory figures sent oil prices gaining on hopes that demand may be picking up in the world's largest consumer of crude.
 
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 down 0.13% and trading at USD106.04 a barrel, while the spread between the Brent and U.S. crude contracts stood at USD11.58 a barrel.

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