Investing.com – U.S. crude futures broke through $51 on Wednesday in a third straight session of gains after Chinese data gave hopes to higher demand and amid speculation weekly supply data due later in the session will show U.S. crude inventories fell at a faster pace than expected last week.
China's exports fell more than expected in May as global demand remained stubbornly weak, but imports beat forecasts, adding to hopes that the world’s second largest economy may be stabilizing.
Exports declined 4.1% year-on-year, worse than the expected decline of 3.6%, but imports only slipped 0.4%, compared to forecasts for a 6.0% slump.
Meanwhile, investors looked ahead to the weekly data on U.S. crude inventories.
The U.S. Energy Information Administration will release its weekly report on oil supplies at 14:30GMT, or 10:30AM ET, amid expectations for a drop of 2.8 million barrels.
Gasoline stockpiles are expected to fall by 0.7 million barrels while stocks of distillates, which include heating oil and diesel, are also expected to drop by 0.2 million barrels, according to analysts.
After markets closed Tuesday, the American Petroleum Institute, an industry group, said that U.S. oil inventories fell by 3.6 million barrels in the week ended June 3, compared to expectations for a decline of 3.5 million barrels.
Crude stocks at the Cushing, Oklahoma, delivery hub for WTI dropped by 1.3 million barrels, the API said, while gasoline inventories increased by 760,000 barrels and distillate inventories rose by 270,000 barrels.
Crude oil for July delivery on the New York Mercantile Exchange climbed to an intraday high of $51.13 a barrel, rising past the $51-mark for the first time since last July. It last stood at $51.05 by 10:57AM GMT, or 6:57AM ET, up 69 cents, or 1.37%.
A day earlier, New York-traded oil prices rose 67 cents, or 1.35%. U.S. crude futures are up nearly 85% since falling to 13-year lows at $26.05 on February 11 as a decline in U.S. shale production boosted sentiment.
However, with prices now at levels that make drilling economical for some firms, the rig count might start rising soon and the decline in U.S. production may slow.
According to oilfield services provider Baker Hughes, the number of rigs drilling for oil in the U.S. increased by nine last week to 325, ending three straight months of weekly declines.
Elsewhere, on the ICE Futures Exchange in London, Brent oil for August delivery rose 78 cents, or 1.52%, to trade at $52.22 a barrel after hitting a daily peak of $52.24, its highest level since last October.
On Tuesday, London-traded Brent rallied 89 cents, or 1.76%, on reports of more attacks by militants to Nigeria oil operations.
Brent prices have been well-supported in recent weeks as unplanned supply disruptions in Africa eased concerns over a global glut. Brent futures prices are up by roughly 90% since briefly dropping below $30 a barrel in mid-February.
Meanwhile, Brent's premium to the WTI crude contract stood at $1.17 a barrel, compared to a gap of $1.08 by close of trade on Tuesday.