Oil Rises After US GDP Even With Higher Inventories

West Texas Intermediate crude traded near $101 a barrel after a government report showed that U.S. fuel inventories advanced and as the country’s economy rebounded more than forecast in the second quarter.

Gasoline inventories gained for a fourth week and diesel stockpiles rose for a ninth week. Crude stockpiles fell 3.7 million barrels to 367.4 million in the week ended July 25, according to the Energy Information Administration. A 1.25 million-barrel decline in supply was projected by analysts surveyed by Bloomberg. Gross domestic product rose at a 4 percent annualized rate after shrinking 2.1 percent from January through March, Commerce Department figures showed today.

WTI for September delivery advanced 7 cents to $101.04 a barrel at 10:51 a.m. on the New York Mercantile Exchange. Futures traded at $101.44 before the release of the report at 10:30 a.m. in Washington. The volume of all futures traded was 14 percent below the 100-day average.

Brent for September settlement slipped 24 cents to $107.48 a barrel on the London-based ICE Futures Europe exchange. Volume was 30 percent lower than the 100-day average. The European benchmark crude traded at a $6.44 premium to WTI on ICE. The spread closed at $6.75 yesterday, the widest since July 4.

Crude supplies at Cushing, Oklahoma, fell by 924,000 barrels to 17.9 million last week. The decline left stockpiles at the lowest level since October 2008, data from the EIA, the Energy Department’s statistical arm, showed.

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