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Oil rises as dollar eases, Cushing stockpiles fall
[NEW YORK] Oil prices moved higher on Wednesday, buoyed by a weaker dollar and a slight drop in US crude inventories at the key Cushing terminal, the first in more than four months.
US benchmark West Texas Intermediate (WTI) for June delivery jumped US$1.52 to close at US$58.58 a barrel.
Brent North Sea crude for June delivery, the global benchmark, settled at US$65.84 a barrel in London, a gain of US$1.20 from Tuesday's closing.
WTI, which fell in opening trade, rebounded after US Department of Energy released its weekly petroleum stockpiles report. Traders looked past a smaller-than-expected increase of 1.9 million barrels of crude oil last week, the 16th consecutive rise, that brought stockpiles to a fresh record high of 490.9 million barrels.
The market focused on the first decline in inventories at the key hub in Cushing, Oklahoma, since late November. Though small - half a million barrels to 61.7 million - the drop was seen as a sign of cutbacks in high US crude-oil production.
The market also found "a lot" of support from the dollar's move lower, said John Kilduff of Again Capital. A weaker greenback makes dollar-priced crude oil cheaper for buyers using other currencies.
The dollar fell against the euro as a US government report showed growth in the world's largest economy nearly stalled in the first quarter. In late trade it was at US$1.1110 per euro, compared with US$1.0981 late Tuesday.
Meanwhile, at the end of a two day pollicy meeting, the Federal Reserve left open the timing of an increase in ultra-low interest rates. It said it saw the slowdown in the economy "in part" due to transitory factors, predicting that US growth would return to a "moderate pace".