Oil prices rose to multi-month highs on Wednesday after government data showed that US inventories of oil contracted for the fifth consecutive week last week.
West Texas Intermediate (WTI) crude oil, the main US oil benchmark, was 2.2% higher at $49.77 per barrel while Brent crude, the international benchmark, was up by 2.0% at $51.87 per barrel at the time of writing. The last time that WTI and Brent crude traded above these levels was on June 29 and June 10, respectively.
Stockpiles of oil stored in the US slid by 3 million barrels to 499.7 million barrels in the week ended September 30, data published by the Energy Information Administration (EIA) showed. This was a smaller contraction than the 7.6 million barrel weekly fall projected by the American Petroleum Institute on Tuesday.
US crude oil refinery inputs averaged over 16.0 million barrels per day during the week, 302,000 barrels per day less than the previous week’s average, the EIA’s data showed. Refineries operated at 88.3% of their operable capacity, down from 90.1% in the previous week. Finished gasoline inventories decreased slightly and distillate fuel inventories decreased by 2.4 million barrels.
Oil prices advanced last week after the Organisation of Petroleum Exporting Countries (OPEC), a bloc whose members collectively generate around 40% of the world’s oil, agreed in principle to cut output growth. The arrangement, whose details still have to be finalised, came after oil prices underwent around two years of erosion caused by oversupply.