Crude oil traded higher for the second day on Wednesday on predictions that the government data will reveal that crude stockpiles dropped for the sixth week in the US, the world’s biggest oil consumer.
The North American WTI crude for February delivery added 51 cents to $94.18 per barrel on the New York Mercantile Exchange stood at $94.15 at the time of writing. While the European benchmark Brent crude for February settlement rose 0.4% higher to $107.76 a barrel on the ICE Futures Europe exchange. Brent crude oil was at a $13.56 premium to WTI.
The strong cold weather in North America also had an effect on oil prices as oil refineries reported production disruptions.
Crude Oil – US Crude Inventories
Crude oil stockpiles in the US dropped by 7.3 million barrels in the week ending January 3, according to reports from the American Petroleum Institute (API).
According to a separate survey compiled by the Energy Information Administration (EIA), US crude inventories dropped by 2.75 million barrels last week. EIA are expected to release the data later in the day.
Crude Oil – Fuel Supplies
Analysts are expecting to see a rise in Distillate inventories, including heating oil and diesel by 2.25 million barrels in the week ended Jan 3, according to a survey. Investors are also expecting to see a rise in gasoline stockpiles by 2.5 million barrels.
Crude Oil – Libya
Libya has restarted its largest oil fields, El Sharara on Monday, with an initial output of 60,000 barrels a day after protesters in the area agreed to end their blockade which has been disrupting production in the country for weeks, the state National Oil Corp (NOC) confirmed.
Production in Libya dropped to 250,000 barrels a day, down from 1.43 million barrels per day in July 2012.
In Sudan, the ongoing crisis continues as the country’s government has rejected the rebels’ demands after meeting each other for the first time on Tuesday.
All eyes are focus on the release of the Federal Reserve’s minutes from the December meeting, which will be released later during the day.
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