Oil up on hopes of recovery in demand, lower U.S. inventories

The sun sets behind an oil pump in the desert oil fields of Sakhir, Bahrain, December 13, 2015. (AP)

SULAIMANI (ESTA) — Oil prices gained more ground on Wednesday as a U.S. coronavirus fiscal aid package and a decline in crude oil inventories lifted prices.

Brent crude futures rose 19 cents to $51.28 a barrel, by 0606 GMT and U.S. West Texas Intermediate (WTI) crude rose 21 cents to $48.21.

“Oil prices have remained supported by a weaker U.S. dollar overnight and have finally found a friend in the API inventory report,” said Stephen Innes, chief global market strategist at Axi, a broker, according to Reuters.

“This morning the American Petroleum Institute reported a much larger draw versus consensus in crude oil inventories for the week ending December 25.”

The dollar fell to its lowest in more than two years against the euro as currency traders looked past a new delay in U.S. stimulus cheques and maintained bets that additional financial aid was still likely.

The Democrat-led U.S. House of Representatives voted to meet President Donald Trump’s demand to increase direct coronavirus aid payments to Americans hurting from the pandemic to $2,000.

U.S. physical crude oil grades strengthened on Tuesday as the API reported a decline in stockpiles, Reuters cited dealers as saying.

Crude oil stocks fell by 4.8 million barrels last week to about 429.8 million barrels, data from API showed.

(Esta Media Network/Reuters)

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