WASHINGTON (dpa-AFX) - Crude oil futures settled higher on Wednesday on reports the OPEC+ will likely extend production cuts by another month.
Data showing a drop in U.S. crude inventories last week, and expectations of increased demand for oil amid reopening of the economies contributed as well to the uptick in crude oil prices.
West Texas Intermediate Crude oil futures for July ended up $0.48 or about 1.3% at $37.29 a barrel, the best closing level for a front-month contract since March 6.
Brent crude futures were up $0.16 or nearly 0.4% at $39.73 around late afternoon.
Data released by Energy Information Administration (EIA) this morning showed crude stockpiles in the U.S. fell by 2.1 million barrels in the week ended May 29, against expectations for an increase in inventories.
Gasoline inventories increased by 2.8 million barrels last week, while distillate stockpiles climbed up 9.9 million barrels, both significantly higher than expected volumes.
The American Petroleum Institute (API) said on Tuesday that U.S. crude inventories fell by 483,000 barrels for the week ending May 29.
Analysts had predicted an inventory build of 3.038 million barrels. The U.S. government's official supply report is due out later in the session.
The 23-nation OPEC+ group will decide on whether to extend production cuts, during their next meeting. It is widely expected that the cartel will extend output cuts through July or August.
Earlier, they had agreed in April to cut their total oil output by 9.7 million barrels per day from May 1 through June 30.
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