Oil is near its highest level since November as industry estimates point to another drawdown in U.S. crude stockpiles.
West Texas Intermediate (WTI) crude oil traded above $81 U.S. a barrel after rallying 3.8% on Tuesday (January 11). The American Petroleum Institute reported that U.S. crude inventories fell by about one million barrels last week.
That report followed a monthly report from the U.S. Energy Information Administration that showed global oil inventories will decline slightly in the first quarter, compared to a previous forecast of expansion.
Crude oil rallied Tuesday to its highest close since November 11 alongside gains in raw materials and equities after U.S. Federal Reserve (Fed) Chairman Jerome Powell sought to reassure investors that the central bank can reign in inflation without damaging the U.S. economy.
In addition to its stronger balance for the first quarter, the EIA also said global oil stockpiles declined by almost three million barrels a day in December, underscoring recent bullish price moves.
WTI for February delivery rose 0.3% to $81.42 U.S. a barrel in London trading. Brent crude oil for March settlement was little changed at $83.75 U.S. a barrel on ICE Futures Europe.
