- Ole Hansen, Saxo Bank
Oil prices jumped above the $50 level on Wednesday as US crude oil inventories dropped unexpectedly last week. According to the Energy Information Administration's report, domestic crude stockpiles fell 0.6 million barrels in the week ended October 21, following the preceding week's 5.2 million barrel decline, while market analysts anticipated a slight increase of 0.7 million barrels during the reported period. Meanwhile, the American Petroleum Institute's preliminary report released on Tuesday suggested a 4.8 million barrel rise for the same week. Crude oil stocks usually rise at this time of year as the summer driving season ends and refineries enter the autumn turnaround season. The EIA also said that gasoline stocks dropped 2 million barrels, whereas analysts had expectations for a 1 million barrel decline. Moreover, distillate stockpiles were down 3.4 million barrels, surpassing the 1.4 million barrel drop forecast.
After the release, Brent futures were seen trading $0.33 lower at $50.46 per barrel by 14:35 GMT on the New York Stock Exchange, whereas West Texas Intermediate futures were seen trading $0.06 higher at $50.02 by the same time.
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