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Oil Prices Rise on Tightening Supply Hopes, Diminishing U.S. Inventories

Published 08/30/2018, 11:10 AM
© Reuters.  Crude moves higher buoyed by supply hopes, falling U.S. stockpiles.
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Investing.com - U.S. crude prices rose on Thursday as traders speculated on further tightening of supply, as weekly U.S. inventory data showed diminishing inventories.

New York-traded West Texas Intermediate crude futures gained 22 cents, or 0.32%, at $68.69 a barrel by 11:06 AM ET (15:06 GMT), not far from its intraday high of $69.73.

Meanwhile, Brent crude futures, the benchmark for oil prices outside the U.S., rose 26 cents, or 0.34%, to $77.72.

OPEC confirmed reports earlier in the week that the cartel and its partners led by Russia delivered only 109% of pledged oil supply curbs, when it had decided to reduce those levels to 100% near the end of June.

The monitoring committee further expressed its satisfaction with recent indications that there was a good balance between supply and demand in the market, leading to speculation that the group may not need to further increase output.

Meanwhile, traders also assessed the impact of the upcoming U.S. sanctions against Iran, which will start to kick in from November, while the expected disruptions to supply from Venezuela provided another bullish focus for market participants.

Further adding to buying sentiment this week, official U.S. government data released on Wednesday revealed that U.S. commercial crude inventories were down 2.6 million barrels in the week to Aug. 24, quadrupling the lesser draw that markets had expected and sending a positive signal on oil demand stateside.

In other energy trading, gasoline futures slipped 0.05% to $2.0015 a gallon by 11:08 AM ET (15:08 GMT), while heating oil dipped 0.04% to $2.2478 a gallon.

Lastly, natural gas futures edged down 0.07% to $2.861 per million British thermal units.

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