Oil Rises on Libyan Disruption

Oil prices climbed on Monday, looking to extend gains made last week on the back of halted production at a Libyan oil field and an unexpected drop in U.S. crude stockpiles.

West Texas Intermediate crude oil for April delivery CLJ8, +0.65%  on the New York Mercantile Exchange—the U.S. benchmark—rose 34 cents, or 0.5%, to $63.89 a barrel after trading as low as $63.06. For last week, it rose roughly 3.3%, but the contract is still around 1% lower month to date.

West Texas Intermediate graph

The global benchmark—April Brent crude LCOJ8, +0.46% —tacked on 28 cents, or 0.4%, to $67.59 a barrel on the ICE Futures Europe exchange. Last week, it put up a weekly gain of 3.8%.

The weekly U.S. petroleum inventory report due Wednesday is “likely to provide some support, as a large build to crude stocks—as is seasonal for February—continues to be errant amid lower net imports,” said Matt Smith, director of commodity research at ClipperData.

The U.S. Energy Information Administration said Thursday the amount of crude oil in storage fell by 1.6 million barrels in the week ended Feb. 16. The surprise decline followed weeks of crude inventory builds in the U.S. that, along with rising production, had weighed on prices.

“Total U.S. commercial oil stocks subsequently dipped below the five-year average for the first time in nearly four years,” according to Stephen Brennock, an analyst at brokerage PVM Oil Associates Ltd.

via MarketWatch

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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