Oil at Recent Highs on Sharp Crude Drop

Petroleum prices rose to their highest since early March on Wednesday after data showed a big drop in U.S. crude inventories, although gains were capped by concerns that mounting coronavirus infections will lead to reduced fuel demand.

Brent crude was up $1.43, or 3,22%, at $45.86 U.S. a barrel mid-morning Wednesday, while West Texas Intermediate crude rose $1.45, or 3.5%, to $43.15 U.S. a barrel.

U.S. crude inventories fell 8.6 million barrels in the week to Aug. 1 to 520 million barrels, compared with analysts’ expectations for a three-million-barrel drop, the American Petroleum Institute found.

Global coronavirus deaths surpassed 700,000 on Wednesday, according to a Reuters tally, with the United States, Brazil, India and Mexico leading the rise in fatalities.

Experts see jet fuel demand at 50% lower through Q3 compared with last year.

Sentiment drew some support from signs talks between Democrats in Congress and the White House on a new coronavirus relief package are making progress, although the sides remain far apart.