On Wednesday, both US and UK crude oil futures’ prices had mushroomed more than 3 per cent, as US EIA (Energy Information Administration) data had unveiled a bigger-than-anticipated plunge in US crude inventories, while expectations over a global economy recovery with numbers of vaccinated people growing quicker-than-expected in major G20 economies, had added to further bullish breeze.
Apart from that, a US Federal Reserve data released earlier in the day had unveiled that US factory output grew by 0.2 per cent in August, missing an analysts’ forecast of 0.4 per cent, though, July output was revised higher to 1.6 per cent from a prior 1.4 per cent and several industry analysts had expressed sheer optimism over a jubilant fourth-quarter amid a sharp increase in orders for US-made goods ahead of a busy holiday season, overshadowing the slowdown in August factory output which eventually bode well for black gold contracts’ prices.
Concomitantly, US EIA (Energy Information Administration) was quoted saying in a statement that US crude inventories had pummelled to their lowest level since September 2019, as more than 30 per cent crude outputs in the US Gulf of Mexico had still been shut-in as an aftermath of Hurricane Ida.
Crude oil leaps amid US crude inventory drawdown
Citing statistics, on Wednesday’s commodity market wind down, UK crude futures’ prices settled just a notch shy of 3 per cent higher to $75.72 a barrel after hitting an intra-session peak of $76.13 a barrel, the highest since late-July, while US WTI (West Texas Intermediate) crude oil contracts climbed 3.3 per cent to $72.75 a barrel.
Meanwhile, citing a likely long-lasting repercussion of Hurricane Ida in global crude oil market, an energy market analyst at CHS Hedging, Tony Headrick said, “We have seen large crude and product draws which is supportive to the energy complex.
The tropical storm that just came through slowed down recovery efforts from Hurricane Ida and we will continue to see the effects from Ida for the next few reports”.