Oil holds gains on shrinking U.S. stockpiles

By Sonali Paul
MELBOURNE, Oct 15 (Reuters) - Oil prices rose slightly in
early trade on Thursday after data showed U.S. crude stockpiles
fell last week, adding to 2% gains overnight, as OPEC and its
allies were seen fully complying in September with their pact to
curb output.
U.S. West Texas Intermediate (WTI) crude CLc1 futures
picked up 4 cents, or 0.1%, to $41.08 a barrel at 0032 GMT,
while Brent crude LCOc1 futures rose 5 cents, or 0.1% to
$43.37 a barrel.
Oil markets climbed for a third day despite a resurgence in
COVID-19 infections across Europe potentially denting fuel
demand.
"The energy markets are certainly marching to their own
drummer at the moment," said Michael McCarthy, chief market
strategist at CMC Markets and Stockbroking, adding that recent
oil price volatility may have attracted more trader positions.
The American Petroleum Institute industry group said U.S.
crude, gasoline and distillate inventories all fell in the week
to Oct. 9, according to a report released after market close on
Wednesday. Crude stockpiles fell by 5.4 million, while distillate
stockpiles, which include diesel and heating oil, fell by 3.9
million barrels. Those drawdowns were nearly double analysts'
expectations in a Reuters poll. The U.S. Energy Information Administration is due to release
its weekly data on Thursday, a day later than normal following a
public holiday.
The Organization of the Petroleum Exporting Countries (OPEC)
and its allies, together called OPEC+, had 102% compliance with
their agreement to cut oil supply in September, two OPEC+
sources told Reuters ahead of a meeting of the OPEC+ technical
committee on Thursday to review the oil market. ANZ Research pointed to sharp gains in China's crude oil
imports in September and buying by India's refiners ahead of two
big festivals helping support the market.
"The outlook in Asia could be the reason OPEC+ alliance
remains confident the market can withstand another 2 million
barrels per day in the market," ANZ Research said in a note.
Oil prices have climbed this week despite concerns about
renewed lockdowns hitting fuel demand as COVID-19 infections
surge in Europe. New cases have hit around 100,000 daily,
compared with more than 51,000 in the United States.
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