Investing.com – Crude futures settled higher on Wednesday, as data showed U.S. supplies of crude oil fell for an eighth-straight week while fears of falling demand for gasoline eased, following a bigger-than-expected decline in gasoline inventories.
On the New York Mercantile Exchange crude futures for October delivery rose by 1.2% to settle at $48.41 a barrel, while on London's Intercontinental Exchange, Brent added 1.39% to trade at $52.59 a barrel.
Crude oil rose for a second-straight day, as a report from the Energy Information Administration (EIA) showed crude and gasoline stockpiles fell last week but gains were capped as U.S. output remained at a two-year high of 9.528m barrels, up 26,000 bpd from last week.
Inventories of U.S. crude fell by roughly 3.3m barrels in the week ended Aug 18, missing expectations of a draw of about 3.5m barrels. It was the eighth-straight week of falling crude inventories.
Gains were capped, however, after the EIA’s reported that total domestic crude production rose 26,000 barrels per day (bpd) to 9.528m bpd last week.
Gasoline inventories, one of the products that crude is refined into, fell by roughly 1.2m barrels, confounding expectations of a draw of 643,000 barrels while distillate stockpiles rose by 28,000 barrels, beating expectations of a rise of 93,000 barrels.
The steeper-than-expected decline in gasoline inventories comes against expectations that gasoline demand is set to tail off, as the peak of the summer driving season has passed.
“The peak of summer driving season has now passed, and demand for crude will also wane as refinery runs drop,” said Matt Smith, director of commodity research at ClipperData. “Gasoline demand will ebb as summer road trips are mostly over and children head back to school.