Published: Fri, February 23, 2018
Money | By Hannah Jacobs

Oil ends higher after surprise drop in crude stocks

Oil ends higher after surprise drop in crude stocks

Wednesday reported a fall in USA oil inventories by around 900,000 barrels for the week ending February 16.

U.S. West Texas Intermediate crude futures advanced 0.05 percent to trade at $62.80 per barrel and Brent crude futures were off by 0.02 percent at $66.38.

Data released mid-morning Thursday by the U.S. Energy Information Administration showed commercial crude inventories south of the border fell by 1.6 million barrels in the week to February 16. Inventories dropped further at the key storage hub in Cushing, Oklahoma, according to data from the Energy Information Administration (EIA).

The correlation between moves in the oil price and the dollar has strengthened in the last couple of weeks, as investors increasingly sell other assets to buy the USA currency on expectations of a faster pace of rate rises.

Meanwhile, U.S. crude exports jumped to more than 2 million barrels per day (bpd), close to the record 2.1 million bpd in October.

Prices were prevented from falling further by a decline in US crude inventories, traders said.

The largest privately owned crude terminal in the US, the Louisiana Offshore Oil Port (LOOP), recently completed the first very large crude carrier (VLCC) crude oil loading operation.

This timely development comes as demand for oil continues to surge in Asia, especially China.

Globally, oil markets remain well supported due to demand-growth coinciding with production restraint led by the Organization of the Petroleum Exporting Countries (OPEC) and Russian Federation.

With the strengthening dollar, the oil price has lost almost 10 percent since hitting a multi-year high above $70 in January.

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