SULAIMANI (ESTA) — Oil prices climbed on Thursday, reversing previous losses, as a bigger-than-expected draw in U.S. gasoline and distillate stocks prompted buying.
Prices were also buoyed by expectations that soaring natural gas prices as winter approaches will drive a switch to oil to meet heating demand.
Brent crude futures gained 82 cents to $83.87 a barrel at 0618 GMT after falling 0.3% on Wednesday.
U.S. West Texas Intermediate (WTI) crude futures climbed 62 cents to $81.06 a barrel, after dropping 0.3% the previous day.
“A larger-than-expected drop in the U.S. gasoline and distillate inventories led to fresh buying,” said Kazuhiko Saito, chief analyst at Fujitomi Securities Co Ltd.
The American Petroleum Institute (API) said on Wednesday U.S. crude stockpiles rose by 5.2 million barrels for the week ended Oct. 8, but gasoline inventories fell by 4.6 million barrels and distillate stocks fell by 2.7 million barrels, according to market sources who saw the API data.
Analysts in a Reuters poll expected crude inventories to rise by 0.7 million barrels, but gasoline stocks to drop by 0.1 million barrels and distillate to decline by 0.9 million barrels.
“With OPEC+ sticking to an existing pact for a gradual increase in oil output and some OPEC countries missing to reach their quota, supply will remain tight and oil prices will stay on a bullish trend at least until next OPEC+ meeting,” Saito said.
The Organization of the Petroleum Exporting Countries, Russia and their allies, known as OPEC+, earlier this month “reconfirmed the production adjustment plan”, referring to a previously agreed deal under which 400,000 barrels per day (bpd) would be added in November.
(Esta Media Network/Reuters)
