Investing.com - Crude oil prices gained smartly in Asia on Wednesday on Iraq tension, shrugging off an industry report that showed a solid gain in U.S. crude stocks.
The American Petroleum Institute, an industry group, said late Tuesday that there was a four million-barrel build in crude stocks. The group also said that gasoline supplies rose by 2.2 million barrels and stocks of distillates fell by 253,000 barrels, according to the sources.
Overnight, crude futures fell as investors sold the commodity for profits for a second session on sentiments that the Sunni insurgency in Iraq has yet to affect operations in the country''s major oilfields, which are far away from the violence.
On the New York Mercantile Exchange, West Texas Intermediate crude oil for delivery in August traded at $107.11 a barrel, up 1.01%, after hitting an overnight session low of $105.28 a barrel and a high of $106.46 a barrel.
Brent oil on the ICE futures exchange rose 0.3% to $114.46 a barrel with the spread with West Texas Intermediate widening by 48 cents to $8.43 a barrel.
Brent typically reacts more strongly to geopolitical tensions because U.S. oil production is high and most domestic crude can''t be exported.
Investors locked in gains stemming from fears that the Iraqi insurgency will disrupt supply and sold for profits, as the violence still remains far away from the country''s main oilfields in the south.
Iraq produced approximately 3.5 million barrels a day of oil last month, making it OPEC’s second-biggest oil producer behind Saudi Arabia, and reports earlier confirmed market sentiments that crude continues to flow from the crisis-ridden country.
Exports from Iraq''s southern terminals averaged 2.53 million barrels per day (bpd) up to June 21, according to shipping data and Reuters sources, a that suggests production remains on track to resemble May''s average of 2.58 million bpd - the highest since 2003.
U.S. new home sales rose to a six-year high, surging 18.6% in May to an annual rate of 504,000, according to the U.S. Census Bureau. May''s figure was the highest level since May 2008 and the largest monthly increase since January 1992.
Analysts were expecting new home sales to rise 1.6% to 440,000 units.
Separately, the Conference Board reported that its consumer confidence index jumped to 85.2 in June from 82.0 last month. It was the highest reading since January 2008.
Analysts were expecting a reading of 83.5.
On Wednesday, the U.S. is to publish data on durable goods orders, as well as revised data on first quarter growth.
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