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Oil prices edge towards $50 after US crude stocks slump

Oil prices edge towards $50 after US crude stocks slump

Oil prices inched towards US$ 50 a barrel in early Asian trade on Thursday, after US government figures showed a sharper-than-expected draw down of crude stocks previous week as imports dropped. Buoyant stock markets also supported cost, with the Dow Jones industrial average , the S&P 500 and the Nasdaq Composite all climbing overnight.

But gains in oil were capped as the US$ hovered near an eight-week high against a basket of currencies.

US crude futures had risen 5 cents to US$ 49.61 a barrel by 0045 GMT. They settled the last session 94 cents higher, after marking a 7-month high of USD 49.62.

Brent climbed five cents to US$ 49.79 a barrel, having closed up USD 1.13, or 2.3%, in the previous era.

“I wouldn’t be surprised to see the rally extend a bit further,” said Ric Spooner, chief market analyst at Sydney’s CMC Markets.

“There’s a decent chance it will breach USD 50 a barrel (later on Thursday).

” united State crude stocks fell 4.2 million barrels to 537.1 million in the week to May 20, the steepest weekly drop in 7 weeks, the united State Department of Energy’s Energy Information Administration said on Wednesday.

That was larger than analyst expectations of a 2.5 million barrel fall, but not as much as the 5.1 million expected by trade group, the American Petroleum Institute.

Gasoline stocks rose 2 million barrels to 240.1 million barrels against forecasts of a 1.1 million-barrel drop, the EIA said.

Stockpiles of distillates, which include diesel and heating oil, declined by 1.3 million barrels to 150.9 million, as indicated by the EIA.

Crude oil imports fell 4.7 percent to 7.3 million barrels per day last week, the EIA said.

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