Crude oil prices gained on wednesday after a technical rebound, mainly pushed up by a report from the Department of Energy regarding inventory levels.
Light sweet crude oil for July delivery jumped $1.73 to settle at $101.32 a barrel and July Brent crude contract spiked by $2.40 at $114.93.
“It seems to be a technical rally, with little follow-through,” Tradition Energy Senior Director of Market Research Addison Armstrong said in an email.
“The trigger was breaking yesterday’s high of $100.09; the target is $101.42, which was the high last week,” Armstrong said. “DOE stats were somewhat supportive, but total U.S. crude inventories remain above the five-year high.”
The Department of Energy said on Wednesday that U.S. commercial crude inventories have increased by 600,000 barrels week-over-week in the week ended May 20 way lower that the expected 1.3 million barrel fall in stocks. Total motor gasoline inventories increased by 3.8 million barrels last week vs. a projected 300,000 barrel increase.
U.S. crude oil inventories were above the upper limit of the average range for this time of year and gasoline inventories were in the lower limit of the average range, the DOE said. Distillate fuel inventories decreased by 2 million barrels last week and were in the upper limit of the average range for this time of year, according to the report. Analysts were expecting an increase of 100,000 barrels.
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