Crude Rises For Second Day On Lower US Supplies, Worries Over Libyan Oil

Crude oil rose for a second day on Wednesday amid believes crude stockpiles will fall in the US, the world’s biggest oil consumer, for a sixth week, while new worries over Libyan supplies also gave support.

The US Energy Information Administration report today may show that crude inventories fell by 2.75 million barrels last week, one day after the American Petroleum Institute said that crude supplies shrank by 7.31 million.

Distillates, including heating oil and diesel, may rise by 2.25 million barrels last week, while gasoline stockpiles probably expanded by 2.5 million barrels. The API reported a gain of 5.17 million barrels for distillates and a 5.58 million increase for gasoline.

Meanwhile, the situation in Libya, holder of Africa’s biggest oil reserves, looks quite uncertain. Tensions in the North African country escalated after “a heavily armed autonomy group invited foreign companies to buy oil from seized ports”.

Moreover, the coldest US weather in almost 20 years is threatening drilling and fracking operations and may lead to a rise in fuel demand. At least five refineries in the United States and Canada cut operations due to cold temperatures.

However, caution is seen rising ahead to Wednesday`s minutes from the Fed`s recent policy meeting, the policy decisions from Europe and UK on Thursday and Friday’s US non-farm payrolls report that may give clues on the strength of the economy.

- WTI crude oil futures for February is trading around $ 93.98 a barrel after rising $0.31

- Brent futures for February settlement is trading around $ 107.49 a barrel after rising $0.14

- Natural gas is trading at $ 4.328 per cubic feet after rising 0.67%

- Gasoline is trading at $ 2.6723 per cubic feet after falling 0.24%

- Heating oil (diesel) is trading at $ 2.9565 a gallon after falling 0.09%