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Oil Hits Three-Month High Above $75 on Signs of Stockpile Drop - BLOOMBERG
(Bloomberg) -- US crude climbed above $75 a barrel for the first time in almost three months after an industry report pointed to another decline in American inventories.
West Texas Intermediate futures advanced as much as 1.4% on Wednesday, bringing their gains over the past two weeks to roughly 8%. US stockpiles shrunk by 4 million barrels last week, the American Petroleum Institute reported. That would be a seventh straight draw and the longest streak of declines in three years if confirmed by government data later Wednesday.
Oil has had a strong start to 2025 as prices break out of a months-long range, but many analysts continue to warn of a glut this year and technical indicators suggest the advance may have run too far. The market is also bracing for Donald Trump’s second presidential term, with threats of tougher sanctions on Iran and trade tariffs on China.
Futures pushed higher on Tuesday — reversing earlier losses — as frigid weather in the US boosted demand for heating fuel, and raised the risk of freeze-offs in production areas, while northern Europe is also facing snow and ice.
“Cold fronts in the US and Europe are driving crude higher, with some support from concerns over the loss of Iranian barrels if the Trump administration tightens sanctions,” said Vandana Hari, founder of Vanda Insights in Singapore. “Nonetheless, crude looks overbought. It may yield to profit-taking, though that might need a reminder of the global economic headwinds.”
In a sign of tightening supply, Russian data show that its oil production was below its OPEC+ output target last month, after seaborne exports slumped to the lowest level since August 2023. Meanwhile, ports in the eastern Chinese province of Shandong, the top destination for Iranian crude, were urged to prevent US-sanctioned tankers from docking at their berths.
Stockpiles at Cushing, the delivery point for WTI, dropped by 3.1 million barrels, the API reported, according to a document seen by Bloomberg. That would take inventories to lowest since 2014 if confirmed by government figures.
