2023-08-30 04:50:55
Oil prices are rising with the decline in US crude inventories
Oil prices extended their gains today, Wednesday, after industry data showed a significant drop in crude inventories in the United States of America, the world’s largest consumer of fuel, in light of supply concerns due to Hurricane Idalia.
Brent crude futures, for October delivery, rose 17 cents, or 0.2%, to $85.66 a barrel. The October contract expires tomorrow, Thursday, and the November contract was the most active, at $85.08 a barrel, up by 17 cents.
West Texas Intermediate crude futures rose 24 cents, or 0.3%, to $81.40, recording gains for the fifth session.
The weakness of the US currency makes dollar-denominated oil less expensive for investors than holders of other currencies, which boosts demand for it.
Yesterday, Tuesday, each of the two benchmarks rose more than a dollar a barrel, with the dollar falling, after the prospects for raising interest rates decreased in the wake of the weak jobs data.
Meanwhile, market sources said, quoting American Petroleum Institute figures, that crude oil inventories fell by about 11.5 million barrels in the week ending August 25.
Analysts polled by Archyde.com before the data were released had estimated a decline of 3.3 million barrels.
Meanwhile, investors bought futures on concerns surrounding Hurricane Adalia, which is lashing the Gulf of Mexico to the east, from major US oil and natural gas production sites.
Likewise, data from the Energy Information Administration indicate that offshore fields in the Gulf of Mexico represent about 15% of US crude production, and approximately 5% of natural gas production.
Oil major Chevron has evacuated some of its employees from the region, but production is continuing at its sites in the Gulf of Mexico.
While crude oil stocks declined, the Petroleum Institute data showed that gasoline stocks rose by about 1.4 million barrels, and distillate stocks, including diesel and jet fuel, rose by about 2.5 million barrels.
Official crude inventories data from the Energy Information Administration is due at 14:30 GMT on Wednesday.
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