By Ben Sharples - Jun 5, 2013 7:02 AM GMT+0530
West Texas Intermediate crude rose for the second time in three days as an industry report showed U.S. inventories dropped the most since December.
Futures gained as much as 0.7 percent in New York after the American Petroleum Institute said crude stockpiles shrank 7.8 million barrels last week. A government report today is forecast to show supplies declined by 800,000 barrels, according to a Bloomberg News survey of analysts. The U.S. will extend waivers for nine nations that import Iranian oil from sanctions, an official said. Employment data from the U.S. and trade figures from China are scheduled this week.
“The fall in inventories seems to have supported the market,” said Michael McCarthy, a chief market strategist at CMC Markets in Sydney. “It will be surprising to see any major moves ahead of that potentially game-changing” data from the U.S. and China, he said.
WTI for July delivery climbed as much as 67 cents to $93.98 a barrel in electronic trading on the New York Mercantile Exchange and was at $93.86 at 11:30 a.m. Sydney time. The volume of all futures traded was 36 percent below the 100-day average. Prices slid 14 cents to $93.31 yesterday.
Brent for July settlement rose as much as 25 cents, or 0.2 percent, to $103.49 a barrel on the London-based ICE Futures Europe exchange. The European benchmark grade was at a premium of $9.64 to WTI futures. The spread was $9.93 yesterday, the widest based on closing prices since April.
U.S. gasoline stockpiles fell 1.3 million barrels in the week ended May 31, the API said. An Energy Information Administration report today is projected to show supplies rose 1 million barrels, according to the median estimate of 11 analysts in the Bloomberg survey.
Distillate inventories, including heating oil and diesel, increased 241,000 barrels, according to the API data. The EIA, the Energy Department’s statistical arm, will probably report a 1.4 million-barrel gain, the survey shows.
Crude stockpiles at Cushing, Oklahoma, the delivery point for WTI contracts and the biggest oil storage hub in the U.S., dropped 454,000 barrels last week, according to the API data. That was the first decline in four weeks.
The API in Washington collects supply information on a voluntary basis from operators of refineries, bulk terminals and pipelines. The government requires that reports be filed with the EIA for its weekly survey.
Sanctions exemptions on Iranian oil imports for China, India, Malaysia, South Korea, Singapore, South Africa, Sri Lanka, Turkey and Taiwan will be extended, according to the U.S. official who spoke on condition of anonymity because the decision hasn’t been made public.
A December 2011 law cuts off access to the U.S. banking system for any foreign financial institutions that handle oil trading with Iran, unless their home countries have earned a waiver by significantly reducing imports. The measures are intended to pressure the Persian Gulf nation to abandon aspects of its nuclear program, which the U.S. and Israel say are aimed at developing atomic weapons.
U.S. employers probably added 167,000 workers last month, according to a Bloomberg News survey of economists before Labor Department data on June 7. China is scheduled to release May import and export figures on June 8.
WTI’s rebound may stall along its middle Bollinger Band, at about $94.40 a barrel today, according to data compiled by Bloomberg. Futures yesterday halted an intraday advance near this indicator for a fourth day, signaling it’s where sell orders may be clustered.
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