(Bloomberg) -- Crude climbed as a U.S. government report showed oil stockpiles in the world’s largest economy fell by the most in four months.
Futures in New York rose as much as 0.9 percent, briefly surpassing $58 a barrel for the first time in a week. American crude inventories tumbled by 6.5 million barrels last week, the Energy Information Administration said Wednesday. That was more than double the average estimate in a Bloomberg survey. Exports surged by the most on record as West Texas Intermediate crude trades at an attractive discount to the global Brent benchmark.
“Crude inventories are just taking a nose-dive,” Matt Sallee, who helps manage $16 billion in oil-related assets at Tortoise Capital Advisors LLC, said by telephone. “Clearly, that’s being helped out by the WTI discount, supporting pretty robust exports.”
Yet, gasoline stockpiles rose for a sixth week and diesel supplies unexpectedly edged higher.
Oil is on track for a yearly rise following a decision by the Organization of Petroleum Exporting Countries and its allies to extend supply cutbacks through the end of 2018. Global stockpiles will remain below seasonal levels and continue to shrink through the second quarter of next year, according to Goldman Sachs Group Inc (NYSE:GS).
Saudi Arabian Oil Minister Khalid Al-Falih said that he’s optimistic about the global oil-cuts pact, while Kuwait’s Oil Minister Bakheet Al-Rashidi said compliance with the output cuts reached 122 percent in November, the highest monthly level since the agreement took effect in January.
WTI for February delivery advanced 36 cents to $57.92 a barrel at 11:44 a.m. on the New York Mercantile Exchange.
Brent for February settlement gained 43 cents to $64.23 on the London-based ICE Futures Europe exchange. The global benchmark crude traded at a premium of $6.31 to WTI.
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U.S. crude inventories slipped to 436.5 million barrels last week, the lowest level since October 2015, while crude exports jumped by 772,000 barrels a day, the EIA data showed.
Meanwhile, gasoline stockpiles climbed 1.24 million barrels, and distillate supplies increased by 769,000 barrels, more than triple what was forecast in a Bloomberg survey. Crude production remained at a record-high.
Oil-market news:
- Analysts at Jefferies Group LLC raised their forecast for global crude prices by about 10 percent and said OPEC-led supply cuts and decelerating U.S. production will sop up a worldwide supply glut more quickly than expected next year.
- Saudi Aramco’s IPO is moving ahead and all options are open on where to list shares of the giant oil producer, the country’s finance minister said.
