Crude Oil Ends Higher Despite Rise In Inventories

(RTTNews) - U.S. crude oil ended higher on Wednesday, mostly on bargain hunting even as the official crude supply data from the Energy Information Administration showed crude stockpiles in the U.S. to have increased more than expected.

Meanwhile, the first shipment of oil from Libya left the Ras Lanuf port for the first time in almost a year.

Earlier today, a report from the U.S. Energy Information Administration showed U.S. crude oil inventories to have increased 1.4 million barrels in the week ended August 8, while analysts anticipated a decline of 2.0 million barrels. The EIA report showed U.S. crude oil inventories at 367.00 million barrels, end last week.

Gasoline stocks decreased by 1.2 million barrels last week, with analysts anticipating a drop of 1.5 million barrels. Inventories of distillate, including heating fuel, dropped 2.4 million barrels, while analysts expected an increase of 0.25 million barrels.

Late Tuesday, a report from the American Petroleum Institute showed crude oil stockpiles to have risen by 2 million barrels in the week ended August 8.

Meanwhile, the U.S. Energy Information Administration in its monthly short-term energy outlook lowered its global oil consumption forecast for 2014 and 2015. The agency also indicated a distinct slowing in oil production growth by countries outside the OPEC or the Organization of the Petroleum Exporting Countries.

Investors also continued to monitor developments in Ukraine amid reports a convoy of 280 Russian trucks have left for eastern Ukraine, carrying humanitarian aid. Ukraine has stated the convoy will not be allowed in to Ukraine unless Russia adhered to protocol and send the aid under the leadership of the Red Cross.

Light Sweet Crude Oil futures for September delivery, the most actively traded contract, gained $0.22 or 0.2 percent to close at $97.59 a barrel on the New York Mercantile Exchange Wednesday.

Crude prices for September delivery scaled a high of $97.73 a barrel intraday and a low of $96.75.

On Tuesday, crude oil futures ended lower, dragged down by demand concerns after the International Energy Agency lowered its preliminary oil demand outlook for this year and 2015, with concerns over developments in the Middle East and Ukraine.

The dollar index, which tracks the U.S. unit against six major currencies, traded at 81.60 on Wednesday, up from its previous close of 81.51 late Tuesday in North American trade. The dollar scaled a high of 81.68 intraday and a low of 81.36.

The euro traded higher against the dollar at $1.3371 on Wednesday, as compared to its previous close of $1.3369 late Tuesday in North American trade. The euro scaled a high of $1.3415 intraday and a low of $1.3344.

In economic news from the U.S., a report from the Commerce Department showed retail sales were virtually unchanged in July, after edging up by 0.2 percent in June. Economists expected another 0.2 percent increase in sales. Excluding a modest drop in auto sales, retail sales inched up by 0.1 percent in July compared to a 0.4 percent increase in the previous month.

A report from the U.S. Commerce Department showed business inventories to have increased 0.4 percent in June, following a 0.5 percent increase in May, in line with economists' estimates.

The Bank of England has downgraded its wage growth estimate and said that any interest rate hike will be only gradual. With inflation likely to remain close to the 2 percent target, interest rate may well stay at historically low levels for sometime.

In Asia, Chinese industrial production in July grew at a slower pace of 9 percent from a year ago. Retail sales too saw a slower growth, rising 12.2 percent in July, after increasing by 12.4 percent in the preceding month.