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Oil Prices Up as U.S. Crude Stocks Decrease -Breaking

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© Reuters.

By Gina Lee

 

Investing.com – Oil pieces have climbed after a decrease in U.S. crude stockpiles and higher equities pushed by economic data. 

edged up 0.03% to $75.62 by 9:51 PM ET (2:51 AM GMT) and  were up 0.35% to $73.12. 

Energy Information Administration last week reported that crude inventories fell by 4.72 Million barrels. Omicron worries can be countered by rising home sales and increased consumer confidence. 

“The report was modestly bullish, due to the large crude oil inventory drawdown,” said John Kilduff, a partner at Again Capital LLC. For tax avoidance reasons, however, he noted that the average fall in crude oil inventories occurs around this time each year.

The outlook for consumption is not good. The U.S. saw an increase in gasoline stocks as the implied demand fell to nearly half of a million barrels per hour last week. The city of Xi’an in China is also tightening its rules to curb an outbreak, according to local media. The impact Omicron has had on global market demand so far is limited. 

Bullish sentiment was aided by an energy shortage in Europe, and disruptions to supplies from Libyan and Nigeria. Oil has also been supported by weakness in the dollar, which makes it less costly for other currency holders.   

“Holidays can be treacherous in the market,” said Phil Flynn, senior market analyst for Price Futures Group. “We have seen crazy moves on light volume.”

Flynn added that in the short-term, geopolitical issues could provide some support to a rally in oil, most notably from tensions in Europe in response to Russia’s natural gas deliveries.

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