Oil Climbs After Sharp Drop in US Inventories

Oil prices rose on Wednesday following a sharp drop in US crude inventories, with the market waiting for next steps from a meeting later in the day on the future level of output cuts by OPEC and its allies.
Brent crude futures were up 19 cents, or 0.4%, at $43.09 a barrel, and US West Texas Intermediate crude futures rose 17 cents, or 0.4%, to $40.46 a barrel, CNBC reported.
Reflecting a recovery in fuel demand despite the coronavirus pandemic, US crude inventories fell by 8.3 million barrels in the week to July 10, beating analysts’ expectations for a decline of 2.1 million barrels, according to data from industry group the American Petroleum Institute.
Official numbers from the US Department of Energy’s Energy Information Administration are due on Wednesday. “American Petroleum Institute number, a unique number assigned to every oil and gas well, released overnight, have provided some support to the market in early morning trading today,” ING Economics said in a note.
On supply, the market will be closely watching for news from a meeting of the Joint Ministerial Monitoring Committee of the Organization of the Petroleum Exporting Countries later on Wednesday.
“The market will be eager to see if deeper cuts will be rolled over for an additional month, or whether the group will stick to the original plan, and start trimming cuts,” according to ING Economics.