Oil Jumps After US Gasoline Stockpiles Plunge to 22-Month Low

Will the FOMC Meeting Drive the US Dollar and Crude Oil Futures

Commercial crude oil inventories in the country increased for the consecutive third week soaring by 4.6 million barrels in the week ending 15 September to reach 472.83 million barrels.

Under the deal, OPEC members and some non-OPEC countries pledged to cut production by 1.8 million bpd from January to tighten the market and prop up prices.

November WTI crude oil futures settled at $50.73, up $0.83 or +1.66% and December Brent crude oil futures closed at $55.86, up $0.96 or +1.75%.

Analysts at Panmure Gordon shared that the prices are now increasing since the last weeks as forecasts stated of increased demands from both the IEA and OPEC along with anticipated high demands from the U.S.as the oil refineries will resume their operations after Hurricane Harvey.

Gasoline stockpiles were down 2.1 million barrels for the week, while distillate stockpiles fell 5.7 million barrels, according to the EIA.

The EIA also said total domestic crude output rose by 157,000 barrels a day to 9.510 million barrels a day.

"Demand is clearly coming back, so there is a need for refining to come back online".




November WTI crude prices rose to $51.11 on Wednesday, its highest price since May 25, but the market is still trading well short of its high that day at $52.62. The October contract expired Wednesday after gaining 1.9 percent to close at $50.41.

On Friday, OPEC and its producer friends meet in Vienna to discuss the progress of their deal to limit production, trim the global supply and stabilize prices.

Oil prices dipped during Thursday's trade due to hike in U.S. crude inventories and production as well as stronger dollar.

That's the contention of Bloomberg, which again pointed to International Energy Agency data showing that if OPEC continues to produce at current rates - about 32.7 million barrels per day (bpd) - global inventories will accumulate rather than diminish next year, by about 300,000 bdp.

"Exempt members Libya and Nigeria may be bought into the fold of the production cut deal".

The cuts have already been extended by nine months until the end of March 2018, over which time U.S. production has added 500,000 BPD.

Elsewhere, gasoline futures gained slipped 0.18% to $1.662 a gallon, while natural gas futures fwere steady at $3.123 per million British thermal units.

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