Oil Extends Gains After Larger Than Expected Drop in US Crude Stocks

Oil extended its gains on Wednesday after a weekly petroleum status report showed a larger than expected draw in US crude stockpiles. Stockpiles of US crude fell by 9.5m barrels to 459m barrels in the week ended July 5, the Energy Information Administration said. Inventories of gasoline, one of the products that crude is refined into, fell by 1.45m barrels, compared with expectations for a draw of 1.3m barrels. That helped push oil prices higher with West Texas Intermediate, the US crude marker, up 3 per cent to $59.63 a barrel, while Brent crude, the global oil benchmark, rose more than 3 per cent to $66.29 a barrel. Concerns about the health of the global economy stemming from the fallout from Washington’s multi-fronted trade war have kept a check on oil prices. “We continue to suspect that the combination of continued Opec+ supply discipline, lower US inventories, Libyan and Venezuelan production risks, along with boiling Iran tensions will all help to lift crude higher, even as demand expectations moderate somewhat,” strategists at TD Securities added. Financial Times

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