Oil jumps after U.S. crude stockpiles shrink most since August

NEW YORK: Oil topped $ 62 a barrel for the first time since May 2015 after U.S. crude stockpiles shrank by the most since the summer driving season.

Futures rose as much as 0.9 per cent in New York. American crude inventories slipped by 7.42 million barrels last week as refiners boosted operating rates to the highest level in more than a decade, the Energy Information Administration said on Thursday. Stored crude supplies have been dwindling for seven straight weeks and the scope of last week’s withdrawal surprised analysts.

“The crude oil inventory number was pretty healthy relative to consensus,” Brian Kessens, who helps manage $ 16 billion in energy assets at Tortoise Capital Advisors LLC, said by telephone. “People are optimistic that there are some tailwinds behind the underlying crude oil price.”

Oil is hovering near $ 62 in New York and a settlement above that mark would be the first time since December 2014. The Organization of Petroleum Exporting Countries and Russia are working to reduce global inventories and price levels have also been boosted by concerns over the stability of the group’s third-biggest producer, Iran. Meanwhile, in the U.S., crude output rose last week.

West Texas Intermediate for February delivery jumped 42 cents to $ 62.05 a barrel at 11:37 a.m. on the New York Mercantile Exchange, the highest intraday level since May 2015.

Brent for March settlement advanced 12 cents to $ 67.96 on the London-based ICE Futures Europe exchange. The global benchmark crude traded at a premium of $ 6.08 to March WTI.

U.S. crude inventories fell to 424.5 million barrels last week, while distillate supplies climbed by about 8.9 million barrels, the most since December 2016, the EIA said. U.S. refineries boosted operating rates for a third straight week, contributing to the decline in stored oil supplies.