Oil Rises After US Inventories Down

West Texas Intermediate rose to a four-day high after U.S. crude stockpiles fell as refiners in the world’s biggest oil consumer boosted processing to the highest level since 2005. Brent advanced in London.

Futures increased as much as 1.5 percent in New York, extending a 1.2 percent gain yesterday. Crude stockpiles shrank by 7.53 million barrels last week, the most since January, while refineries operated at 93.8 percent of capacity, the U.S. Energy Information Administration reported yesterday. President Barack Obama’s administration, acting with the European Union, imposed sanctions on Russian banks and energy and defense companies in its latest bid to punish the country over Ukraine.

“The crude stockpile draw explains why WTI is up a bit,” Christopher Bellew, a senior broker at Jefferies Bache Ltd. in London, said by e-mail. “Russian sanctions do not seem to be worrying the market for now. The bigger picture is the weak crude oil market in Europe.”

WTI for August delivery rose as much as $1.55 to $102.75 a barrel in electronic trading on the New York Mercantile Exchange, the highest since July 11, and was at $102.59 at 1:28 p.m. London time. The contract increased $1.24 to $101.20 a barrel yesterday, the biggest gain since June 12. Prices have advanced 4.2 percent this year.

Brent for September settlement rose 80 cents higher to $107.97 a barrel on the London-based ICE Futures Europe exchange. The European benchmark crude traded at a premium of $6.03 to WTI for the same month on ICE. The August contract decreased 17 cents to $105.85 when it expired yesterday.

via Bloomberg

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Alfonso Esparza

Alfonso Esparza

Senior Currency Analyst at Market Pulse
Alfonso Esparza specializes in macro forex strategies for North American and major currency pairs. Upon joining OANDA in 2007, Alfonso Esparza established the MarketPulseFX blog and he has since written extensively about central banks and global economic and political trends. Alfonso has also worked as a professional currency trader focused on North America and emerging markets. He has been published by The MarketWatch, Reuters, the Wall Street Journal and The Globe and Mail, and he also appears regularly as a guest commentator on networks including Bloomberg and BNN. He holds a finance degree from the Monterrey Institute of Technology and Higher Education (ITESM) and an MBA with a specialization on financial engineering and marketing from the University of Toronto.
Alfonso Esparza