Oil up over $2 on drawdown in US crude stocks

Oil prices rose by more than $2 on Wednesday after data showed a larger-than-expected draw in US crude stockpiles, but gains were capped by a snowstorm that is expected to hit US travel.

Brent crude futures were up by $2.23, or 2.8%, at $82.22 a barrel by 1740 GMT. US West Texas Intermediate crude futures gained $2.03, or 2.7%, to $78.26.

US crude inventories fell by 5.89 million barrels, according to data from the US Energy Information Administration (EIA), compared with estimates for a drop of 1.66 million barrels. Data from the American Petroleum Institute on Tuesday showed a 3.1million barrel draw in the week to December 16, market sources said.

“This report is very bullish, especially with the fact that there’s a draw from the crude oil equation and distillate inventories stopped their streak of builds ahead of the cold blast,” said Phil Flynn, Analyst at Price Futures group.

Distillate inventories fell by 242,000 barrels, according to EIA data, compared with analyst estimates for a build of 336,000 barrels.

Published in The Express Tribune, December 22^nd, 2022.

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