Crude and Brent oil have recovered early losses and are trending higher this morning despite the downside pressure from USD as the dollar index hits a two-month peak.
Crude oil has moved off from the day’s lows of $39.30 to test $40.00, while Brent has risen back towards $42.50 after earlier falling towards yesterday’s intraday lows around $41.61,
The latest US oil inventories report from the American Petroleum Institute showed a surprise build in crude stockpiles.
US oil inventories rose by just shy of 700,000 barrels in the week ending September 18th, according to the latest API report. Analysts had predicted that crude stockpiles fell by 2.256 million barrels.
Although moving in the wrong direction the build is relatively small, especially considering the dent to inventories made by the previous week’s 9.517 million barrel draw.
The report revealed that US oil production increased during the period, but at 10.9 million barrels per day is still 2.2 million bpd below the highs of 13.1 million bpd seen in March.
Sentiment had also been supported by a much larger-than-expected draw in gasoline, with stockpiles falling by 7.735 million barrels compared to analyst’s expectations of a 614,000 barrel drop. Distillates fell by over 2 million barrels.
The official US oil inventories report from the Energy Information Administration is due out later today.
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