Crude Oil Prices Hit 1-Month Highs, Demand Hopes Supportive

Crude Oil Prices Hit 1-Month Highs, Demand Hopes Supportive

In the areas affected by the hurricane, gasoline prices rose even more, but they still remained below the national average.

It comes after the International Energy Agency (IEA) said that the global demand and Opec production cuts were starting to reduce the global oil glut.

"It looks like we are turning the corner", Phil Flynn, senior market analyst at Price Futures Group Inc in Chicago, said by telephone.

Much of that was due to a near 10 million-barrel increase in stocks in the U.S. Gulf region and as crude production rebounded from a brief Harvey interruption.

Crude oil inventories rose by a smaller-than-expected 5.9 million barrels in the September 8 week to 468.2 million, 2.5 percent below their level a year ago, the Energy Information Administration (EIA) said in its weekly report Wednesday. As of March 2017, 49% of total USA working crude oil storage capacity and more than 40% of working storage capacity for both motor gasoline and diesel fuel were located in the Gulf Coast region.

Oil supply from outside of OPEC is expected to grow by 780,000 b/d in 2017, unchanged from last month's report, to 57.8 million b/d.

Gasoline inventories, according to the EIA fell last week, by 8.4 million barrels, generally in tune with API's estimate of a 7.896-million-barrel decline-and the largest gasoline draw on record.

Oil prices continue to dwindle down as Hurricane Irma continues to push oil refineries down.

Oil prices rose after the report was published, with Brent crude adding 10 cents to $54.37 per barrel around 0820 GMT. S. crude stockpiles rose almost twice expected levels last week as refineries cut output following Hurricane Harvey, while gasoline and distillate inventories drew, industry group the American Petroleum Institute said after the market settled.

Zanganeh said compliance by members of the Organization of the Petroleum Exporting Countries with an agreement to curb oil output had been about 98 percent in the past eight months and would improve in the future.

United States gasoline stocks slumped 8.4 million barrels, the largest one-week decline since the EIA started recording the data in 1990, while distillate stocks fell 3.2 million barrels.

Futures slipped 0.5%in NY after rising 1.2% Monday.

"As far as Harvey is concerned, disruption to local oil markets in the US Gulf Coast is easing on a daily basis and its impact on global markets is likely to be relatively short-lived", said the agency, which advises the OECD on energy markets.

"The market is reacting in anticipation of refineries restarting at the same time expecting a decline in demand due to the after effects of Hurricanes Harvey and Irma", said Andrew Lipow of Lipow Oil Associates in Houston.

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