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Oil Pops Surprises US Stock Slide; Eyeing OPEC By Investing.com

© Reuters.

Investing.com – An unexpected drop in US stocks has brought oil to life, as expectations of deeper cuts in OPEC and its allies have declined.

West Texas Intermediate, the benchmark for New York-traded oil futures, as well as London's Brent, the global oil indicator, ended the US official session on Wednesday with more than 1% each.

The rally came after the US Energy Information Administration dropped 1.7 million barrels in the week ending October 18, compared with analysts' expectations for a 2.2 million barrel construction.

rose $ 1.49, or 2.7%, to reach $ 55.97 a barrel.

$ 1.47, or 2.46%, at $ 61.17 per barrel.

Oil prices were pressured ahead of the release of EIA data, after Russian Energy Minister Alexander Novak said no formal proposal had been tabled to change the terms of a global agreement on restricting oil supplies agreed between the two. OPEC and its allies.

The recovery came as investors continued to see declines in fuel stocks such as diesel and gasoline last month, while refineries produced fewer of these products amid plant closures to meet new marine fuel processing standards.

fell 3.1 million barrels, compared with an expected fall of 2.27 million barrels. fell about 2.72 million barrels, against forecasts of a decline of about 2.8 million barrels.

Refinery execution rates increased slightly to around 85% of capacity from 83% in the previous week. But that was still far below the industry norm of at least 90 percent.

Investing.com analyst Barani Krishnan said the surprise draw with oil was also helped by a significant drop in oil imports. Despite being the world's largest producer of light oil, the United States still buys significant volumes of heavy oil each week from the Middle East and other producers.

“The reason for the draw is that imports dropped more than 400,000 barrels to reach below 6 million for the first time in a while. It has probably become obvious to many that you don't have to care so much about current refinery operating rates. "

And Krishnan added, exports rose to almost 3.7 million barrels a day, ”Krishnan added.

US oil production remained at 12.6 million barrels per day.

"The focus of the market, therefore, is the continuing drop in spirits and gasoline inventories, which are exceeding expectations," Krishnan said. "And of course there are more cuts in OPEC, even though Russia plays mind games, as always with the market."

Retail gasoline prices are slowly decreasing, which usually occurs in the fall. The AAA Daily Daily Gauge Report said the US average was $ 2,628 per gallon, down 1.3% from Wednesday and 1% in the month. In the year, they grew almost 16%.

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