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Oil Up Over Bigger-Than-Expected Draw in U.S. Crude Supplies

CommoditiesSep 23, 2021 12:30
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By Gina Lee

Investing.com – Oil was up Thursday morning in Asia, continuing its upward trend as the latest U.S. crude oil supply data showed a bigger-than-expected draw.

The black liquid also benefitted from increasing investor risk appetite as concerns that China Evergrande Group (HK:3333)would default on its loans and impact the second-largest economy somewhat eased.

Brent oil futures were up 0.25% to $76.38 by 12:23 AM ET (4:23 AM GMT) and WTI futures were up 0.22% to $72.39.

U.S. crude oil supply data from the U.S. Energy Information Administration (EIA), released on Wednesday, showed a draw of 3.481 million barrels for the week to Sep. 17. Forecasts prepared by Investing.com predicted a 2.440-million-barrel draw, while a 6.422-million-barrel draw was recorded during the previous week.

Crude oil supply data from the American Petroleum Institute, released a day before, showed a draw of 6.108 million barrels.

Both Brent and WTI futures jumped 2.5% on Wednesday as the EIA data indicated that supplies were at their lowest level since October 2018.

"Oil fundamentals remain constructive, particularly in the U.S.," ING commodities strategists said in a note.

The EIA data also showed that East Coast refinery utilization rates rose to 93%, the highest rate since May 2019.

Surging natural gas prices is also boosting market sentiment, and “supply shortage of gas could encourage power utilities to shift from gas to oil if winter turns out to be colder this year," ANZ analysts said in a note.

Oil’s gains came even as the dollar remained near a one-month high after the U.S. Federal Reserve’s latest policy decision hinted that interest rate hikes could come in 2022, much quicker than expected.

Oil Up Over Bigger-Than-Expected Draw in U.S. Crude Supplies
 

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