US oil rises on Cushing draw

28 October 2015m News Wires – US crude futures rose from multi-week lows in thin early Asian trade on Wednesday after an industry group reported that stocks fell at the Cushing storage hub in Oklahoma, delivery point for West Texas Intermediate oil contracts.

Oil inventory

Oil inventory

Crude stocks at the delivery hub fell by 748,000 barrels, data from the industry group, the American Petroleum Institute, showed late on Tuesday.

Price gains were limited as a supply glut persists even after US production cuts. Investors are awaiting official inventory data due out later on Wednesday that is expected to show further stockpiling.

Overall US crude stocks rose by 4.1 million barrels in the week to 23 October to 477.1 million, the API data also showed.

US crude for December delivery was up 3 cents at $43.23 a barrel early on Wednesday after earlier rising to as high as $43.48. The contract fell to as low as $42.58 on Tuesday, the lowest since late August.

Brent crude, the global benchmark, was down 1 cent at $46.80 a barrel. It fell to $46.41 on Tuesday the lowest since the middle of September.

“The global glut is still very much weighing on investors minds at the moment,” said Ben le Brun, a market analyst at OptionsXpress in Sydney.

“Some of the major corporates such as BP are talking about sluggish prices through 2016,” he added.

BP on Tuesday announced further spending cuts and more asset sales over the coming years to tackle an extended period of low oil prices and help pay for its $54 billion US oil spill settlement.

The API estimate of US crude stock gains was more than the 3.4-million-barrel rise that analysts surveyed in a Reuters poll had said they expected.

The US Department of Energy’s Energy Information Administration will release its official crude oil and oil product data later on Wednesday.

  • Reuters
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