By Adedapo Adesanya
After posting their fourth consecutive gains on Tuesday, top oil futures struggled to end the fifth straight day on Wednesday despite US government data showing a decline in crude inventories.
Oil prices dropped earlier in the day after the data contradicted Tuesday’s report of a rise in crude inventories from industry group American Petroleum Institute (API). The figures had showed that crude inventories in the United States rose by 4.7 million barrels last week to 452 million barrels, leading investors to a post-settlement sell-off in oil futures.
Following this, prices recovered on Wednesday night as Brent crude, the international benchmark traded up after gaining 0.17 percent equivalent to 11 cents to trade at $65.26 per barrel.
Likewise, the US West Texas Intermediate (WTI) crude, during Wednesday’s session, recorded rise in price by 0.05 percent equivalent to 5 cents to close at $60.90 per barrel.
On Wednesday, the Energy Information Administration (EIA) reported that US crude supplies fell by 1.1 million barrels for the week ended December 13. That was less than the 2.5 million-barrel average decline expected by analysts polled by S&P Global Platts on Tuesday.
The oil market had previously recorded fourth straight gain, lifting prices to a three-month high since mid-September as a result of the phase-one trade deal between the US and China that was announced last week Friday.
Analysts say prices have risen more than 1 percent in the previous session after the trade deal announcement between the world’s top economies which lifted global oil prices and demand.
There is also the reliance on the production cuts from the Organization of the Petroleum Exporting Countries (OPEC) and its allies, led by Russia, which make up a group known as OPEC+, continued to offer some support and prevented a further slide in prices.
OPEC+, which has cut production by 1.2 million barrels per day (bpd) since January 1 this year and with the new deal, it will add another extra cut of 500,000 bpd from January 1 to support the market.
Dipo Olowookere