U.S. crude inventories declining from a record before the Memorial Day weekend spurred speculators to increase bullish bets on oil for a second week.
Hedge funds raised their net-long position in benchmark West Texas Intermediate futures by 4.1 percent in the week ended May 20, U.S. Commodity Futures Trading Commission data show. Prices climbed to a one-month high.
Crude supplies fell the most in four months in the week ended May 16, the U.S. Energy Information Administration said. Refineries produced a record amount of gasoline before the holiday, the start of the summer driving season. AAA, the largest U.S. motoring group, expects it to be the busiest weekend since 2005. Today is Memorial Day in the U.S.
“The decline in crude stocks, particularly after weeks and weeks of build, gave the impetus higher to WTI prices,” Harry Tchilinguirian, BNP Paribas SA’s London-based head of commodity markets strategy, said by phone on May 23. “The market chose to focus on the inventory figure for crude.”
WTI futures gained 74 cents to $102.44 a barrel on the New York Mercantile Exchange in the period covered by the CFTC report. They settled at $102.61 on May 19, the highest since April 21. Prices advanced 61 cents to $104.35 on May 23. The contract fell 0.3 percent today.