The price of oil crossed to the green territory on Wednesday’s opening session thanks to reports regarding a decline in U.S. stockpiles. However some analysts claim that global oversupply prevents potentially higher gains.
According to the American Petroleum Institute (API), crude stockpiles in the United States dropped by 9.2 million barrels to 492.2 million barrels in the week ending on August 11. This is much lower compared to analysts’ expectation of a 3.1 million barrel drop.
Gas stocks unexpectedly increased by 301,000 barrels as analysts from Reuters forecasted a much sharper drop of about 1.1 million barrels.
U.S. West Texas Intermediate (WTI) crude prices rose more than 0.3 percent or 15 cents to finish at $47.70 per barrel and Brent crude prices jumped as high as 0.4 percent or 21 cents to settle at $51.01 per barrel.
The dollar went lower against its major peers on Wednesday. However fresh retail sale data in the United States indicating a surge of 0.6 percent in July have made the greenback retain some of its previous gains. The general impression is that the U.S. economy has done well in the third quarter.
The U.S. dollar index was marginally down by 0.1 percent. Still, the index managed to stay away from the 15-month low of 92.548 it touched last week.
Against the Japanese yen, the greenback was able to climb towards 110.66 yen.