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CORRECTED-Oil rises after surprise drop in U.S. inventories offsets demand concerns

Published 07/29/2020, 09:18 AM
Updated 07/29/2020, 10:40 AM
© Reuters.
LCO
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CL
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(Corrects first paragraph to say inventories decreased, not
increased)
TOKYO, July 29 (Reuters) - Oil prices rose on Wednesday
after an industry report showed that crude inventories in the
United States decreased against expectations, giving the market
a boost amid record increases of coronavirus infections in the
U.S. and elsewhere.
Brent crude LCOc1 was up by 24 cents, or 0.6%, at $43.46 a
barrel by 0041 GMT, after dropping 0.4% on Tuesday.
U.S. oil CLc1 gained 14 cents, or 0.3%, to $41.18 a
barrel, having dropped 1.4% in the previous session.
Inventories of crude oil in the U.S. dropped by 6.8 million
barrels last week to 531 million barrels, data from industry
group the American Petroleum Institute showed on Tuesday.
API/S
Analysts' expectations were for an increase of 357,000
barrels. U.S. government data is due Wednesday.
"This should temporarily alleviate some concerns about
ongoing demand distress," Stephen Innes, chief global markets
strategist at AxiCorp said in a note.
The raging COVID-19 pandemic is keeping alive concerns about
falling fuel demand causing an oversupplied market as record
numbers of infections are reported globally, including the U.S.,
the world's biggest consumer of oil.
Four U.S. states reported one-day records for coronavirus
deaths on Tuesday and cases in Texas passed the 400,000 mark.
Attempts to provide relief amid the outbreak were in
disarray as Republicans in the U.S. disagreed over their own
plan for providing $1 trillion in new coronavirus aid on
Tuesday. In Hong Kong, the government on Wednesday warned the city is
on the edge of a large-scale coronavirus outbreak and urged
people to stay indoors as much as possible.

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