Oil prices extended their gains today, Wednesday, after industry data showed a significant decline in crude stocks in the United States, the largest consumer of fuel in the world, and in light of supply concerns due to Hurricane Adalia.
Brent crude futures for October delivery rose 17 cents, or 0.2%, to $85.66 a barrel by 01:33 GMT. The October contract expires tomorrow, Thursday. The November contract was the most active at $85.08 a barrel, up 17 cents.
West Texas Intermediate crude futures rose 24 cents, or 0.3%, to $81.40, recording gains for the fifth session.
Both benchmarks rose more than $1 a barrel on Tuesday as the dollar fell after prospects of a rate hike diminished in the wake of the weak jobs data. A weaker US currency makes dollar-denominated oil less expensive for investors holding other currencies, boosting demand.
Meanwhile, market sources, quoting American Petroleum Institute figures, said on Tuesday that crude oil inventories fell by about 11.5 million barrels in the week ending August 25. Analysts polled by Reuters before the data were released had estimated, on average, a decline of 3.3 million barrels.
Meanwhile, investors bought futures contracts on concerns surrounding Hurricane Adalia, which is lashing the Gulf of Mexico to the east of major US oil and natural gas production sites.
Data from the Energy Information Administration indicate that offshore fields in the Gulf of Mexico represent about 15% of US crude production and approximately 5% of natural gas production.
Oil major Chevron has evacuated some of its employees from the region, but production is continuing at the sites where it operates in the Gulf of Mexico.
While crude oil inventories declined, the Petroleum Institute data showed that gasoline stocks rose by about 1.4 million barrels, and distillate stocks, including diesel and jet fuel, rose by about 2.5 million barrels.
Official crude inventories data from the Energy Information Administration is due at 14:30 GMT on Wednesday.
