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Crude gains on upbeat U.S. inventory report

Published 07/23/2014, 01:39 PM
Updated 07/23/2014, 01:41 PM
Oil prices gain on U.S. stockpile data, geopolitical concerns

Investing.com - Crude futures rose on Wednesday after data revealed that oil stockpiles in the U.S. fell more than expected last week.

In the New York Mercantile Exchange, West Texas Intermediate crude oil for delivery in September traded up 0.67% at $103.08 a barrel during U.S. trading. New York-traded oil futures hit a session low of $101.80 a barrel and a high of $103.33 a barrel.

The September contract settled down 0.46% at $102.39 a barrel on Tuesday.

Nymex oil futures were likely to find support at $101.48 a barrel, Monday's low, and resistance at $103.45 a barrel, Tuesday's high.

The U.S. Energy Information Administration said in its weekly report that U.S. crude oil inventories declined by 4.0 million barrels in the week ended July 18, well beyond expectations for a decline of 2.8 million barrels.

Total U.S. crude oil inventories stood at 371.1 million barrels as of last week.

The report also showed that total motor gasoline inventories increased by 3.4 million barrels, above forecasts for a gain of 1.3 million barrels, while distillate stockpiles rose by 1.6 million barrels, below expectations for an increase of 2.1 million barrels.

That boosted oil prices by fueling sentiments that demand is on the rise even in an economy that is awash in crude.

Geopolitical concerns kept prices higher as well.

Earlier Wednesday, reports that two Ukrainian jet fighters were shot down over the rebel-held city of Donetsk only days after pro-Russian separatists allegedly shot down a Malaysian Airlines flight with a missile rattled nerves, stoking supply concerns.

Fears the conflict could threaten Russian oil exports supported oil prices, though concerns the conflict could drag on global recovery dampened gains.

Separately, on the ICE Futures Exchange in London, Brent oil futures for September delivery were up 0.46% and trading at US$107.83 a barrel, while the spread between the Brent and U.S. crude contracts stood at US$4.75 a barrel.

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