Oil prices enjoyed a spike of as much as 4% on Wednesday after a huge draw in U.S. gasoline inventories last week convinced the market that energy demand was improving despite U.S. crude stockpiles hitting record highs for a fourth week.
Crude prices also gained support on speculation that top oil producers might agree soon to an output freeze.
U.S. crude futures were up $1.44 at $37.94 U.S. as the clock approached noon ET Wednesday. Brent crude futures rose $1.19 to $40.84 U.S. a barrel, having touched three-month highs on Tuesday above $41.00
Meanwhile, the U.S. Energy Information Administration said crude stockpiles rose 3.9 million barrels to nearly 522 million barrels, as predicted by analysts.
But gasoline inventories fell 4.5 million barrels, much more than the polled number of 1.4 million barrels.
Oil rallied earlier in the day, after an Iraqi oil official told a state newspaper that producers in and outside the Organization of the Petroleum Exporting Countries (OPEC) plan to meet in Moscow on March 20 to discuss an output freeze. But Russia's energy ministry said no date or place had been set for the meeting.
Petroleum prices had risen by around 25% since Saudi Arabia, Qatar, Venezuela and non-OPEC exporter Russia said in mid-February they would leave supply at January's levels if there was enough support from other producers.
