Oil rises to near $70 on US crude inventory drop
SINGAPORE: Oil prices rose to near $70 a barrel Wednesday in Asia, rallying for a second day after U.S. crude inventories unexpectedly fell last week.
Benchmark crude for September delivery was up 79 cents to $69.98 a barrel by midday in Singapore in electronic trading on the New York Mercantile Exchange. On Tuesday, the contract gained $2.44 to settle at $69.19.
Crude has snaked around $70 for about two months amid low summer trading volume. Investors are cheered by signs that the global economy is emerging from recession, but concerned the recovery may be sluggish.
U.S. crude demand has been weak so far this summer, but inventories unexpectedly fell last week, evidence consumption could be rebounding.
Inventories plunged 6.1 million barrels last week, the American Petroleum Institute said late Tuesday. Analysts expected the API numbers to gain 1.1 million barrels, according to a survey by Platts, the energy information arm of McGraw-Hill Cos.
The Energy Department reports mandatory supply figures on Wednesday, while the API numbers are reported by refiners voluntarily.
In other Nymex trading, gasoline for September delivery rose 0.98 cent to $2.01 a gallon and heating oil held at $1.86. Natural gas for September delivery was steady at $3.10 per 1,000 cubic feet.
In London, Brent prices rose 35 cents to $72.71 a barrel on the ICE Futures exchange.