NEW YORK (Reuters) – Oil prices rose nearly 2% on Wednesday, with U.S. crude reaching its highest settlement rate in a year after stocks fell to their lowest levels since March.
U.S. West Texas Intermediate (WTI) crude times rose 93 cents, or 1.7%, to settle at $ 55.69 a barrel, the highest level since January 22, 2020, after touching a high of $ 56.33 earlier in the year. the session.
Brent crude times rose $ 1, or 1.7%, to settle at $ 58.46 a barrel, the highest level since Feb. 21, 2020.
Both criteria are also at their latest in a year. That is where contracts for near-term delivery are more expensive than later supply, a sign of current demand and tighter supply expectations. The U.S. normal contract trades at $ 2.30 more than the contract expires six months later.
U.S. crude oil stocks fell last week to 475.7 million barrels, the Energy Information Administration said Wednesday, their lowest level since March. Refinery usage rates rose 0.6 percentage points.
“Refineries are back in business, which supports crude,” said Phil Flynn, senior analyst at The Price Futures Group in Chicago.
Deep supply cuts from the Petroleum Exporting Countries Group and allies, have been supporting the market, and continued supply cuts continued on Wednesday.
A document seen by Reuters on Tuesday showed that OPEC + expects the oil market to be in deficit throughout 2021, peaking at 2 million barrels per day in May.
“The oil market is still looking for better days ahead with a growing vaccine rollout, stimulating demand, while OPEC + continues to curb production,” said Andrew Lipow. president of Lipow Oil Associates in Houston.
The market was also bolstered by news that Democrats in the U.S. Congress took the first steps toward advancing a $ 1.9 trillion coronavirus support plan proposed by President Joe Biden.
The United States has filed a lawsuit for seizing oil cargo allegedly originating in Iran rather than Iraq, as reported on the looting bill, and which violates rules the US insurgency.
Reporting by Stephanie Kelly in New York; further recitation by Shadia Nasralla, Shu Zhang and Sonali Paul. Edited by Marguerita Choy, Paul Simao and Sonya Hepinstall