Crude Oil Rises On Drop In US Crude Inventories, Geopolitical Risk



Reuters

NEW YORK, July 23 (Reuters) - Crude oil futures rose on Wednesday, as oil stockpiles in the United States fell more than expected and geopolitical tensions in Eastern Europe and the Middle East persisted.

U.S. crude's gains outpaced Brent's for most of the session, after a government report showing that U.S. crude stocks fell by 4 million barrels last week, but Brent caught up as traders covered short positions ahead of the close.

"As the day closes, people are quick to cover up positions or take long positions. No one knows what's going to happen in those next 12 hours and it's better to be safe than sorry," said Carl Larry, chief executive of consultancy Oil Outlooks in Houston.

The U.S. Energy Information Administration also reported crude oil inventories at Cushing, Oklahoma, the delivery point of the U.S. crude contract, fell by 1.45 million barrels.

A build of 5 million barrels in the combined inventories of gasoline and distillates and a 1 percent decline in gasoline demand curbed price gains.

The Ukraine government said two of its fighter jets were shot down over rebel-held territory in eastern Ukraine on Wednesday and that the missiles that brought them down might have been fired from Russia.

A powerful Ukrainian rebel leader has confirmed that pro-Russian separatists had anti-aircraft missiles of the type the U.S. government says were used to shoot down Malaysia Airlines flight MH-17.


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