Commodities

Oil Settles High After Inventory Plunges, But Demand Fear Still Inline

Oil-Settles-High-After-Inventory-Plunges-but-Demand-Fear-Still-Inline

Oil was high in Asia on Wednesday morning after the API (American Petroleum Institute) reported a massive draw in the United States oil inventories but an interruption in production at the Gulf of Mexico, because of the hurricane, settled the crude oil at high from the previous session.

Brent oil futures increased 1.55 per cent to $41.16 (by 4:57 AM GMT), exceeding the mark of $40.

West Texas Intermediate (WTI) hiked 1.83% to $38.98. Both these benchmarks increased by more than 2 per cent during the earlier session.

American Petroleum Institute reported a draw of about 9,517 million-barrel at the end of the week (September 11) against estimates of about 2.970 million-barrel build and the 2.04 million-barrel build recorded during the last week.

Approximately 25% of the United States offshore gas and oil production was closed down on Tuesday due to Hurricane Sally in the Gulf of Mexico. The export port was also closed.

Rystad Energy said that their present estimate for the overall interruption associated with the hurricane is within three million to six million barrels of crude in about 11 days.

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