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The price of oil has risen sharply today, with market participants speculating that tomorrow’s weekly report from the Energy Information Administration (EIA) will point to tightening fundamentals.
A survey of analysts conducted by Reuters shows a consensus estimate of a 2.7 million-barrel decrease in crude oil inventories for last week. Following on from the prior week’s 5.58 million decline, this would amount to a sizeable draw in the US stockpile.
By late in the New York trading session, crude oil futures for January had risen 1.05% to $98.42 a barrel, after earlier trading as high as $98.74, the highest the contract has reached since the end of October.
The decline in crude supplies reported last week was driven by higher capacity utilistation at refineries, which rose to their highest level since the summer driving season over the reporting period. The higher run rates are a response to the strength of demand for crude distillates and the resulting decrease in crude stocks is supportive of the crude price.
The American Petroleum Institute releases its own supply data later today. The EIA was forced to shut its government offices in Washington today on account of the winter storm system that has beset the eastern United States, but says that this will not delay the release of the petroleum status report tomorrow.