Oil prices climbed from three-month gulches on Wednesday, lifted by a surprise decline in U.S. inventories and helped along by figures from the International Energy Agency (IEA) suggesting cuts by the Organization of the Petroleum Exporting Countries should push the crude market into deficit eventually.
The U.S. Energy Information Administration (EIA) reported U.S. inventories fell by 237,000 barrels in the week through March 10, the first drawdown after nine consecutive builds. Analysts expected for an increase of 3.7 million barrels.
Total stockpiles stood at 528.2 million as U.S. crude imports fell by 565,000 barrels and refinery activity declined. EIA said crude stocks at the Cushing, Oklahoma delivery hub rose by 2.13 million barrels.
Brent futures rose more than a dollar from Tuesday's close. By mid-morning Wednesday, oil was up 83 cents, or 1.6%, at $51.75 U.S. a barrel. Prices had hit a three-month low of $50.25 U.S. during the previous day's trading.
Moreover, gasoline stocks fell by 3.1 million barrels, compared with analysts' expectations for a two-million-barrel drop. EIA also reported distillate stockpiles, which include diesel and heating oil, were down 4.2 million barrels, versus expectations for a 1.7-million-barrel drop
