Oil Jumps In Volatile Trade On Saudi Pipeline, US Inventories
NEW YORK, Nov 5 (Reuters) - Oil prices jumped on Wednesday, with Brent rebounding from a four-year-low, as traders reacted to rumors of a pipeline blast in Saudi Arabia and bullish news on U.S. crude inventories.
Data from the Energy Information Administration (EIA) showed U.S. crude inventories rose 460,000 barrels last week, significantly less than the 2.2 million barrels predicted by analysts in a Reuters poll.
A fire on Wednesday at an oil product pipeline carrying diesel north of the Saudi Arabian capital, Riyadh, had been extinguished, state news agency SPA and security and industry sources said. Oil prices surged earlier on unconfirmed talk of a crude pipeline explosion in Saudi Arabia.
"The Saudi rumour definitely shook things up, given that we're living in a world full of threats to oil supply. But we did calm down after that and step back and look at the bigger picture of what the inventories meant," said Phil Flynn, an analyst at Price Futures Group in Chicago.
Benchmark Brent oil closed up 13 cents at $82.95 a barrel. During a volatile morning, Brent first fell to a 2010 low of $81.63, when the dollar hit 4-1/2-year highs, then surged to a session peak of $84.45.
U.S. West Texas Intermediate (WTI) crude settled up $1.49 at $78.68 a barrel. It rose to $79.35 earlier, from an intraday low of $76.46.
The sharper rise in WTI versus Brent brought the price gap between the two oils <CL-LCO1=R> to below $4.50 a barrel, the smallest in two weeks.
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