Oil Rises on U.S. Fuel Levies Despite Spike in Coronavirus Cases

MELBOURNE, July 28 (Reuters) – Oil prices soared on Wednesday after industry data showed U.S. inventories of crude and commodities fell more sharply than expected last week, bolstering expectations that the demand will outpace supply growth even amid increasing COVID-19 cases.

US West Texas Intermediate (WTI) crude futures rose 43 cents, or 0.6%, to $ 72.08 a barrel at 1:19 a.m. GMT, reversing Tuesday’s 0.4% decline.

Brent crude futures rose 38 cents, or 0.5%, to $ 74.86 a barrel, after losing 2 cents on Tuesday in the first decline in six days.

Data from the American Petroleum Institute industry group showed U.S. crude inventories fell 4.7 million barrels for the week ending July 23, gasoline inventories fell 6.2 million barrels Barrels and distillate inventories fell 1.9 million barrels, according to two market sources, who spoke on condition. anonymity.

This compares to analysts’ expectations for a 2.9 million drop in crude inventories, following a surprise increase in crude inventories the week before, which was the first increase since May.

Traders are awaiting data from the US Energy Information Administration (EIA) on Wednesday to confirm the decline in stocks.

“Most energy traders weren’t fazed by construction last week, so expectations should be high for EIA crude oil inventory data to confirm stocks have resumed their trend. on the downside, ”OANDA analyst Edward Moya said in a research note.

On gasoline inventories, analysts expected a drop of 900,000 barrels in the week to July 23.

“The United States is still in the middle of driving season and everyone is trying to make the most of this summer,” Moya said.

Expectations for fuel demand are shaken by the surge in cases of the highly infectious Delta variant of the coronavirus in the United States, where the seven-day average for new cases has risen to 57,126. That’s about a quarter of the pandemic peak. Read more

Reporting by Sonali Paul; edited by Richard Pullin

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