U.S. oil futures soar 3% to trade above $60 ahead of API supply data

Investing.com - West Texas Intermediate oil futures rose sharply on Tuesday, as traders looked ahead to weekly data on U.S. stockpiles of crude and refined products later in the day.

On the New York Mercantile Exchange, crude oil for July delivery jumped $1.91, or 3.29%, to trade at $60.05 a barrel during U.S. morning hours after hitting an intraday peak of $60.14, the highest level since June 3.

The American Petroleum Institute will release its inventories report later in the day, while Wednesday’s government report could show crude stockpiles fell by 1.7 million barrels in the week ended June 5.

According to industry research group Baker Hughes (NYSE:BHI), the number of rigs drilling for oil in the U.S. fell by 4 last week to 642, the 26th straight week of declines.

Market players have been paying close attention to the shrinking rig count in recent months for signs it will eventually reduce the glut of crude flowing into the market.

Elsewhere, on the ICE Futures Exchange in London, Brent oil for July delivery rallied to $65.08 a barrel, the most since June 3, before trading at $64.96, up $2.27, or 3.61%.

Disappointing Chinese inflation data added to speculation policymakers will have to introduce further stimulus measures to jumpstart the economy amid lackluster growth.

Government data released earlier showed that Chinese inflation for May rose 1.2%, below expectations for 1.3% and down from 1.5% in April.

The producer price index fell by a more-than-expected 4.6% last month, underling concerns over the health of the world's second largest economy.

The Asian nation is the world's second largest oil consumer after the U.S. and has been the engine of strengthening demand.

Meanwhile, the spread between the Brent and the WTI crude contracts stood at $4.91 a barrel, compared to $4.55 by close of trade on Monday.