After the American Petroleum Institute's (API) data released on Tuesday, 9th July showed a massive drop in the United States' crude inventories for the week ending 5th July, international crude prices rose by as much as 2.5 per cent on Wednesday, 10th July.
Brent crude rose by $1.70 to about $66 while the American crude rose by about $1.58 to about $60. The API data showed that crude inventory had dropped by around 8.1 million barrels. The earlier estimates had noted a drop of about 3.1 million barrels.
Contributing to this increase had also been the fact that extracting operations in the Gulf of Mexico had been stopped because of a storm forecast. The Gulf of Mexico contributes to around 17 per cent of the total American crude output.
Commenting on the increase in the oil prices, PVM's analyst Stephen Brennock told Reuters, "For all the doom-mongering on the demand front, oil prices are getting a much-needed kick up the backside this morning courtesy of Mother Nature."
Earlier, the Organisation of Petroleum Exporting Countries (OPEC) and Russia had agreed to extend their imposed supply-cut deadline up to 2020 in a bid to stabilise prices.