Oil prices rose for the fifth day in a row on Wednesday, bolstered by U.S. data that showed the amount of crude in storage rose by less than some had expected.
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Light, sweet crude for August delivery rose 50 cents, or 1.1%, to $44.74 a barrel on the New York Mercantile Exchange, the highest close since June 16. Brent, the global benchmark, gained 66 cents, or 1.4%, to $47.31 a barrel.
Data from the U.S. Energy Information Administration showed that crude inventories rose by 100,000 barrels in the week ended June 23. While storage levels edged higher, the official number fell short of projections by the industry group American Petroleum Institute for stockpiles to increase by 800,000 barrels.
Analysts and traders surveyed by The Wall Street Journal expected on average that crude stockpiles would fall by 2.4 million barrels. However, API's Tuesday estimates had led some traders to take a more bearish stance.
"Expectations got greatly reduced on the API report," said John Kilduff, founding partner at Again Capital. "Even though there was still a slight build, it sort of saved the day."
Meanwhile, oil products in storage fell by more than analysts expected, with gasoline stockpiles declining by 900,000 barrels and distillate stockpiles dropping by 200,000 barrels last week. Market participants noted that the latest changes to storage levels may have been influenced by disruptions from Tropical Storm Cindy.
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Wednesday's move continued a rebound from when prices fell into bear market territory last week, helped by bargain hunters and reports of cyberattacks on global businesses impacting shipping giant A.P. Moeller-Maersk A/S and Russian oil producer PAO Rosneft.
Oil prices are "coming back from the brink," said Mark Waggoner, president of Excel Futures. "It was right on the edge...That tells us we're back in the trading range."
Oil recently returned to a bear market even as the Organization of the Petroleum Exporting Countries and a handful of nations outside the cartel have cut global supply by about 2% with the aim of easing a supply glut. But despite efforts by the major oil producers, global stocks remain elevated and investors are growing concerned that the cuts have proven ineffective.
"The market is somehow getting the fact that the rebalancing is not occurring," said Olivier Jakob from the Switzerland-based consultancy Petromatrix. "It's difficult to have a strong rebound when you continue to have builds in the U.S."
Gasoline futures rose 1.6% to $1.4833 a gallon and diesel futures rose 1.4% to $1.4330 a gallon.
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(END) Dow Jones Newswires
June 28, 2017 16:07 ET (20:07 GMT)