Investing.com - West Texas Intermediate oil futures climbed back above the $40-level in North America trade on Wednesday, after data showed that gasoline supplies in the U.S. fell sharply last week, offsetting a surprise build in crude stockpiles.
Crude oil for September delivery on the New York Mercantile Exchange jumped 72 cents, or 1.8% to trade at $40.23 a barrel by 14:38GMT, or 10:38AM ET. Prices were at around $40.05 prior to the release of the inventory data.
The U.S. Energy Information Administration said in its weekly report that gasoline inventories decreased by 3.3 million barrels in the week ended July 29, much more than the expected 0.2-million-barrel decline.
The report also showed that crude oil inventories rose by 1.4 million barrels last week. Market analysts' expected a crude-stock decline of 1.4 million barrels, while the American Petroleum Institute late Tuesday reported a supply drop of 1.3 million barrels.
Supplies at Cushing, Oklahoma, the key delivery point for Nymex crude, fell by 1.12 million barrels last week, the EIA said.
Total U.S. crude oil inventories stood at 522.5 million barrels as of last week, which the EIA considered to be “historically high levels for this time of year”.
For distillate inventories including diesel, the EIA reported an increase of 1.2 million barrels.
On Tuesday, New York-traded oil sank to a more than three-month low of $39.26. WTI crude futures are nearly 23% lower from their 2016 highs above $50 a barrel scaled in early June, technically placing it in bear market territory, as signs of an ongoing recovery in U.S. drilling activity combined with elevated stocks of fuel products weighed.
Elsewhere, on the ICE Futures Exchange in London, Brent oil for October delivery tacked on 68 cents, or 1.63%, to $42.48 a barrel, after falling to a more than three-month low of $41.51 on Tuesday.
London-traded Brent futures are down almost 21% since peaking at $52.80 in early June, as prospects of increased exports from Middle Eastern and North African producers, such as Iraq, Nigeria and Libya, added to concerns that a glut of oil products will cut demand for crude by refiners.