Oil held above $64 a barrel on Wednesday before a U.S. government report expected to show domestic crude inventories fell for an eighth week, a sign that a supply glut is easing.
The industry group American Petroleum Institute (API) on Tuesday reported a drop in U.S. crude stocks, ahead of Wednesday’s official data. Doubts over the likelihood of a deal next week on Iran’s nuclear work also supported prices.
Brent crude LCOc1 rose 10 cents to $64.55 a barrel by 7.55 a.m. EDT. U.S. crude CLc1 gained 9 cents to $61.10. Both contracts made gains on Tuesday.
“There could be some support from the APIs,” said Tony Machacek, an oil broker at Jefferies Bache in London. “We’re probably going to be testing $66 to the upside,” he added, referring to Brent.
A steady decline in U.S. crude stockpiles from a record high earlier this year has been supporting prices and inventories probably fell by 2.1 million barrels last week, the eighth consecutive drop, according to an analyst poll.
Traders will be focusing on whether the U.S. government’s supply report due at 1430 GMT confirms the 3.2-million-barrel decline reported on Tuesday by the API.