Crude Rises; Early Gains Pared By Inventory Build
Crude futures settled slightly higher Wednesday, paring an early rise after a surprise increase in U.S. oil stockpiles dug in to investor optimism.
Crude stocks rose by 1.8 million barrels last week, the Energy Information Administration reported, topping analysts' average estimate that called for a 900,000-barrel build.
The surprise build cut through early hopes that had resulted from improving U.S. jobs data.
Light, sweet crude for December delivery settled 32 cents, or 0.4%, higher at $92.51 a barrel on the New York Mercantile Exchange after trading as high as $93.79 a barrel earlier in the session. Brent crude on the ICE futures exchange ended 4 cents higher at $109.58 a barrel.
The increase in oil stockpiles allayed some concerns about a recent dip in stocks below their five-year average level for the first time since 2008. But Wednesday's increase was accompanied by a large decline in the stocks of distillates, which include heating oil and diesel, suggesting that fuel supplies are still growing tighter.
Distillate stocks fell by 3.6 million barrels, while analysts predicted a smaller 1.5 million-barrel decline.
"Even though we had a bit of a build here, we're still in an overall destocking trend," said Dominick Chirichella, an analyst at the Energy Management Institute. "From the distillate point of view, it's somewhat positive for prices."
Gasoline stocks rose by 1.4 million barrels, EIA said, surprising analysts that called for a 600,000-barrel decline.
Still, after three straight days of declines, futures remained higher as ADP's monthly national employment report estimated private-sector jobs in the U.S. rose by 110,000 in October, topping economists' expectations.
The data suggest that economic growth is picking up in the world's largest oil consumer.
The gains Wednesday come amid simmering concerns about Europe's sovereign debt crisis. Greece's plan to hold a referendum vote on the country's latest bailout led to a rebellion from some Greek lawmakers, which threatens to topple the government and derail the euro zone's efforts to keep control of the crisis.
Front-month December reformulated gasoline blendstock, or RBOB, settled 0.1% higher at $2.6272 a gallon. December heating oil settled 1.2% lower at $3.0007 a gallon.