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Oil market ticks higher after US petroleum report
[NEW YORK] Oil prices rose modestly on Thursday after a mixed US petroleum report showed declines in crude and gasoline inventories that were larger than expected and a rise in crude production.
US benchmark West Texas Intermediate (WTI) for delivery in July advanced 17 cents to finish at US$57.68 a barrel on the New York Mercantile Exchange, ending a three-day losing streak.
Brent North Sea crude for July closed at US$62.58 a barrel in London trade, up 52 cents from Wednesday's settlement.
The oil market had traded lower earlier in the day after the Department of Energy (DoE) reported US commercial crude inventories fell by 2.8 million barrels to 479.4 million in the week through May 22, while gasoline stockpiles fell by 3.3 million barrels.
Analysts on average had expected a smaller 2.0 million barrel decline in crude and a 1.3 million barrel drop in gasoline, according to a survey by Bloomberg News.
It was the fourth straight week of falling US crude inventories after a steady build-up since January that has pushed stockpiles to record highs, aggravating the global supply glut.
The DoE also reported a rise in US crude production last week, by 304,000 barrels to 9.57 million barrels per day.
Gene McGillian of Tradition Energy said that the declines in crude and gasoline stocks "were the primary reason why the market seems to have come back," but the DoE report "balanced that out by the 300,000 barrel build in US crude production which took us back to a 40-year high."
"I think with the decrease in drilling activity we'll see production come down, probably in the latter part of this year," he said.