Crude Stockpiles Drop Sharply, Oil Prices Stable

Oil prices were pretty much unchanged on Wednesday as government data south of the border showed a larger-than-expected drawdown in U.S. crude stockpiles and another surge in the nation's crude oil production.

Expectations for an extended shutdown of a major North Sea crude pipeline also continued to support markets.

Brent crude was down eight cents at $63.26 U.S. a barrel mid-morning Wednesday. It had settled down $1.35, or 2.1% on Tuesday on a wave of profit-taking after news of a key North Sea pipeline shutdown helped send the global benchmark above $65 for the first time since mid-2015.

U.S. West Texas Intermediate crude was up 14 cents at $57.28 U.S. a barrel, having settled the previous session down 85 cents.

Data released Wednesday by the Energy Information Agency (EIA) showed crude inventories fell by 5.1 million barrels in the week to Dec. 15, compared with analysts' expectations for an decrease of 3.8 million barrels.

Tuesday, industry group the American Petroleum Institute said crude stocks in the United States fell by 7.4 million barrels last week.

Gasoline stocks rose by 5.7 million barrels, compared with analysts' expectations for a 2.5-million-barrel gain. EIA data revealed istillate stockpiles, which include diesel and heating oil, fell by 1.4 million barrels, versus expectations for a 902,000-barrel increase.

The United States is also on its way to pumping as much as top producers Saudi Arabia and Russia, both of which are capping output as part of a deal among producers within and without the Organization of the Petroleum Exporting Countries to drain a global glut of crude.