West Texas Intermediate rose for the first time in three days after the American Petroleum Institute reported that crude inventories shrank at the delivery point for New York contracts. Brent was steady in London.
Futures advanced as much as 0.4 percent. Stockpiles at Cushing, Oklahoma, the largest U.S. oil-storage hub, fell by 1.51 million barrels last week, the industry group said. Supplies nationwide expanded by 3.49 million. Government data today may show a total gain of 500,000 barrels, according to a Bloomberg News survey. Russia called for “emergency” measures to halt violence in eastern Ukraine after separatist militias suffered the heaviest casualties of their insurgency.
“The API report is supportive of higher prices, it’s the reason for the firm tone in trading today,” said Michael McCarthy, a chief strategist at CMC Markets in Sydney who predicts investors may sell West Texas contracts if prices climb to $105.25 a barrel. “There are still background concerns for oil markets around the Ukrainian situation, and that could be the left-field event that causes a further spike.”
WTI for July delivery increased as much as 39 cents to $103.11 a barrel in electronic trading on the New York Mercantile Exchange and was at $102.96 at 11:12 a.m. Sydney time. The contract dropped $1.39 to $102.72 yesterday, the biggest decline since April 30. The volume of all futures traded was about 50 percent below the 100-day average. Prices are up 3.2 percent this month.
Brent for July settlement was 9 cents higher at $109.90 a barrel on the London-based ICE Futures Europe exchange. The European benchmark crude traded at a premium of $6.95 to WTI. The spread closed at $7.09 yesterday, the widest since May 20.
Cushing stockpiles have slid 15 of the past 16 weeks to 23.2 million barrels in the period through May 16, the lowest level since December 2008, according to the Energy Information Administration. Supplies at the hub have decreased since the southern leg of the Keystone XL pipeline began moving crude to Gulf Coast refineries in January.