Oil prices rose again on Wednesday, extending their more than week-long rally after industry data showing a fall in U.S. crude oil stocks added to optimism about an expected rise in global fuel demand.
Brent crude was up by 11 cents, or 0.2%, at $61.20 by 0110 GMT after rising nearly 1% on Tuesday, when it touched a 13-month high. U.S. crude added 2 cents to $58.28.
Crude Oil Inventories Drop
Crude inventories fell by 3.5 million barrels in the week to Feb. 5 to about 474.1 million barrels, data from the American Petroleum Institute showed on Tuesday.
That compared with analysts’ expectations in a Reuters poll for an increase of 985,000 barrels. Official Energy Information Administration (EIA) data is due at 1530 GMT on Wednesday.
“A reading similar to the one reported by the API would likely continue to provide support to the market,” ING Economics said in a note.
Crude oil stocks at the Cushing, Oklahoma, delivery point dropped by 1.4 million barrels, API said.
Still, inventories of gasoline rose, gaining by 4.8 million barrels, compared with analysts’ forecasts in a Reuters poll for a build of 1.8 million barrels. Official data is due later on Wednesday.
Oil prices have rallied since November as governments kicked off vaccination drives for COVID-19, while putting in place large stimulus packages to boost economic activity.
The world’s biggest exporter, Saudi Arabia, is unilaterally reducing supply in February and March, adding to cuts agreed by other members of the Organization of the Petroleum Exporting Countries (OPEC) and their allies.
Some analysts are now forecasting there will be a supply deficit in 2021 as more populations get vaccinated and start going away on trips and working in offices, potentially boosting fuel demand.
Read: Oil Continues to Rally as Analysts Warn of Price Correction
