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U.S. crude rises after inventory draw at Cushing hub

Published 28/10/2015, 03:31
© Reuters. An oil well is seen near Denver
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By Aaron Sheldrick

TOKYO (Reuters) - U.S. 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.

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

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

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

U.S. crude for December delivery was up 3 cents at $43.23 a barrel at 03.08 a.m. BT 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 (L: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 U.S. oil spill settlement.

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

© Reuters. An oil well is seen near Denver

The U.S. Department of Energy's Energy Information Administration will release its official crude oil and oil product data at 2.30 p.m. BT on Wednesday. [EIA/S]

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