Despite U.S. Weekly Production Decline, Oil increased more than One Percent on U.S.
On Wednesday, oil future saw a hiked of 1 percentage to their max is more than a week as buyers were motivated by a small weekly decrease in U.S. production and brushed aside a surprise build in crude inventories in the world’s top oil consumer. Andrew Lipow, president of Lipow Oil Associates in Houston said, “The most interesting thing is crude oil production was down … which is a significant decline given the increases in previous weeks.” Various other analysts and traders examined that the U.S. production witnessed a down in last week was linked to temporary factors such as some maintenance work in Alaska and Tropical Storm Cindy in the Gulf of Mexico that will be upturned in coming weeks.
According to the U.S. Energy Information Administration (EIA), crude stocks saw a massive hike of 118,000 barrels in the last week. But, the weekly production witnessed a decline of 100,000 barrels per day (BPD) (9.3 million bpd). Since 2016, this was the biggest turn down in weekly output. U.S. output during the week ended June 16 almost touched 9.4 million bpd. Futures rose after the EIA’s report, despite the fact that the data showed a pretty good build instead of the 2.6 million-barrel draw that analysts had to predict in a Reuters poll. Brent futures (LCOc1) expanded 66 cents (1.4 percent), to mend down at $47.31 a barrel, while U.S. West Texas Intermediate crude (CLc1) mounted 50 cents (1.1 percent), to settle at $44.74 per barrel.