Oil Extends Rally as U.S. Stockpiles and Crude Production Slump
Oil’s rally picked up steam as U.S. crude stockpiles shrank and domestic output plunged the most in more than a year, adding to supply concerns as tensions escalate in the Middle East.
Futures jumped as much as 1.5% after the Energy Information Administration said domestic oil inventories slipped for a sixth straight week, the longest contraction since January 2018. Production from American fields slid the most since October 2017. Gasoline inventories also declined.
West Texas Intermediate for September delivery rose 60 cents to $57.37 a barrel at 10:44 a.m. on the New York Mercantile Exchange. That brought the U.S. benchmark close to surpassing its 200-day moving average, typically a bullish sign for markets.
Prices were already on track for their fourth straight daily gain on Wednesday as an industry tally signaled tightening supplies and on an announcement that the U.S. and China would resume talks in a bid to end a trade war that’s raised concerns over demand.