Brent crude up 5 percent as Saudi sees improved demand for oil
NEW YORK (Reuters) - Brent crude oil futures surged 5 percent on Wednesday, after Saudi Arabia's oil minister said oil demand was growing and data showed Chinese factories were producing more than expected.
Falling refined products inventories reported by the government helped lift U.S. crude and countered data showing a larger-than-expected U.S. crude inventory build.
Brent April crude LCOc1 rose $2.97 to settle at $61.63 a barrel. U.S. April crude CLc1 rose $1.71 to settle at $50.99.
"The report is relatively bullish, despite the large crude oil inventory build," said John Kilduff, partner at Again Capital LLC.
"The draw downs in the refined product categories represent an offset and are supportive," Kilduff added.
U.S. crude stocks rose 8.4 million barrels last week to a record 434.07 million, the Energy Information Administration (EIA) said on Wednesday, adding 2.4 million barrels at Cushing, Oklahoma, delivery point for the U.S. crude contract. [EIA/S]
The relatively small gain at Cushing may have helped widen the spread between Brent and U.S. crude CL-LCO1=R to its widest since January 2014, with Brent's premium nearing $11 a barrel.
U.S. gasoline stocks fell by 3.1 million barrels, the EIA said, more than analysts surveyed by Reuters expected, while distillate stocks - including diesel and heating oil - fell by 2.7 million barrels, a smaller dip than expected.
With March contract expirations slated on Friday, U.S. March RBOB gasoline RBH5 surged 9.85 cents to settle at $1.7187 a gallon and March ultra-low sulfur diesel HOH5 rose 7.47 cents to $2.1036 a gallon. Continued...