Oil Futures Extend Recent Gains, Settles Sharply Higher

Crude oil prices rose sharply on Wednesday, buoyed by data showing a drop in crude inventories in the week ended October 30.

Optimism over a possible extension of OPEC+ supply cuts supported oil prices early on in the session.

Traders also awaited the outcome of U.S. presidential election.

West Texas Intermediate Crude oil futures for December ended higher by $1.49 or about 4% at $39.15 a barrel.

Brent crude futures were up by about $0.90 or 2.3% at $40.61 a barrel.

According to the data released by Energy Information Administration this morning, crude oil inventories in the U.S. fell 7.99 million barrels in the week ended October 30, against expectations for a build of 890,000 barrels.

Gasoline inventories were up 1.5 million barrels last week, while distillate stockpiles fell by 1.585 million barrels in the week, after falling 4.491 million barrels a week earlier.

Crude stocks at the Cushing, Oklahoma storage hub, rose by 936,000 barrels for the week.

A report from the American Petroleum Institute late Tuesday showed U.S. crude inventories fell by 8 million barrels last week.

With the oil market facing a “very dangerous” situation, keeping current cuts into the first half of 2021 could be considered at the next OPEC+ meetings, state news agency APS quoted Algerian Energy Minister Abdelmadjid Attar as saying on Tuesday.

Meanwhile, as hopes of an early and decisive U.S. presidential election outcome fade, a victory by Donald Trump is viewed as bullish for oil because of his hardline stance on Iran.

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