Oil prices up; U.S. fuel stocks draw sparks rebound from slump
By David Gaffen NEW YORK (Reuters) - Oil prices jumped on Wednesday, rebounding after several days of weakness as a much bigger-than-expected drawdown in U.S.
By David Gaffen
NEW YORK (Reuters) - Oil prices jumped on Wednesday, rebounding after several days of weakness as a much bigger-than-expected drawdown in U.S. gasoline and diesel inventories augured for a coming seasonal increase in refining demand.
Looming U.S. sanctions on oil exporter Iran helped support prices, but traders remained concerned about the worldwide energy demand outlook. On Tuesday, oil prices slumped 5 percent on concerns tied to a weaker economic outlook.
U.S. West Texas Intermediate crude futures rose $1.08 to $67.52 a barrel, a 1.7 percent gain, as of 12:08 p.m. EST (1608 GMT). Brent crude rose 82 cents to $77.25 a barrel. The global benchmark had fallen earlier to a session low of $75.11, the lowest since Aug. 24.
U.S. gasoline futures rose 0.9 percent to $1.853 a gallon.
The U.S. Energy Department said gasoline stocks fell 4.8 million barrels to 229.3 million barrels last week, the lowest since December 2017. Distillates, which include diesel, were down 2.3 million barrels, both more than forecast.
The EIA data also showed U.S. crude inventories rose 6.3 million barrels, much more than the 3.7 million-barrel increase expected in a Reuters poll. [EIA/S]
"The headline number was a little bearish on crude but with the drop in gasoline supplies and an uptick in refinery runs, the market is holding in there pretty good," said Phil Flynn, analyst at Price Futures Group in Chicago.
Refining utilization rose modestly. Flynn said that signaled that maintenance season is coming to a close, and refiners will begin to process more diesel and heating oil as winter approaches.
Prices had slumped as forecasters such as the International Energy Agency predicted slower oil-demand growth for 2019. [IEA/M] Weakness in equities has also weighed on crude. [.N]
"Notwithstanding the last few days of selloffs in equities, I need to see a lot more evidence before we can start talking about a slowodwn in demand," said Joe McMonigle, senior energy policy analyst at Hedgeye in Washington.
With U.S. sanctions on Iranian exports due to take effect on Nov. 4, two people with knowledge of the matter said two Chinese state-owned refiners were not planning to load Iranian oil for November.
Still, Saudi Energy Minister Khalid al-Falih said on Tuesday that Saudi Arabia would step up to "meet any demand that materializes to ensure customers are satisfied".
Some analysts say prices could rebound before the end of the year.
"We still see Brent reaching $85 per barrel by year-end," said U.S. bank Morgan Stanley.
(Additional reporting by Stephanie Kelly; Editing by Marguerita Choy and David Gregorio)
This story has not been edited by Firstpost staff and is generated by auto-feed.
By Robin Emmott and John Irish | BRUSSELS/PARIS BRUSSELS/PARIS France and Germany will agree to a U.S. plan for NATO to take a bigger role in the fight against Islamic militants at a meeting with President Donald Trump on Thursday, but insist the move is purely symbolic, four senior European diplomats said.The decision to allow the North Atlantic Treaty Organization to join the coalition against Islamic State in Syria and Iraq follows weeks of pressure on the two allies, who are wary of NATO confronting Russia in Syria and of alienating Arab countries who see NATO as pushing a pro-Western agenda."NATO as an institution will join the coalition," said one senior diplomat involved in the discussions. "The question is whether this just a symbolic gesture to the United States
BEIJING Chinese President Xi Jinping on Wednesday called for greater efforts to make the country's navy a world class one, strong in operations on, below and above the surface, as it steps up its ability to project power far from its shores.China's navy has taken an increasingly prominent role in recent months, with a rising star admiral taking command, its first aircraft carrier sailing around self-ruled Taiwan and a new aircraft carrier launched last month.With President Donald Trump promising a US shipbuilding spree and unnerving Beijing with his unpredictable approach on hot button issues including Taiwan and the South and East China Seas, China is pushing to narrow the gap with the U.S. Navy.Inspecting navy headquarters, Xi said the navy should "aim for the top ranks in the world", the Defence Ministry said in a statement about his visit."Building a strong and modern navy is an important mark of a top ranking global military," the ministry paraphrased Xi as saying.