By Gina Lee
Investing.com – Oil was up on Thursday morning in Asia, extending gains after a draw in U.S. crude oil supplies boosted fuel demand hopes and hopes of a possible Brexit deal.
Brent oil futures gained 0.27% to $51.38 by 10:45 PM ET (3:45 AM GMT), and rolled over to the Mar 21 contract on Dec. 23. WTI futures were up 0.25% to $48.24. Both Brent and WTI contracts gained more than 2% on Wednesday.
Wednesday’s data from the U.S. Energy Information Administration (EIA) showed a draw of 562,000 barrels in U.S. crude oil supply for the week to Dec. 18. The draw was smaller than the 3.186-million-barrel draw in forecasts prepared by Investing.com, as well as the previous week’s draw of 3.135 million barrels.
The EIA data follows the American Petroleum Institute’s report of a 2.7-million-barrel build in U.S. crude oil supply the day before.
“Oil markets are quiet as all investors are in a holiday mode. Lower U.S. inventories of crude and fuels as well as signs of a potential Brexit deal which led to weaker U.S. dollar were good news, but lingering worries over a new variant of the novel coronavirus capped gains,” Nissan (OTC:NSANY) Securities general manager of research Hiroyuki Kikukawa told Reuters.
News that the U.K. and the European Union (EU) were close to sealing a Brexit agreement, moving away from the chaotic finale anticipated on Jan. 1, also boosted the black liquid’s prices. The dollar was also weaker on Thursday, makes commodities priced in the greenback more affordable for holders of other currencies.
However, some investors remained jittery about fuel demand as the new B.1.1.7 strain of the COVID-19 virus continues to spread across the U.K. and Prime Minister Boris Johnson has imposed tougher restrictions across England. Americans were warned again not to travel for Christmas as the country deals with the latest surge of COVID-19 cases.
News that U.S. energy firms added oil and natural gas rigs for a fifth week in a row during the previous week, also adding to the jitters.