US Crude Climbs on Surprise Drop in US Gasoline Stocks



Reuters

NEW YORK, Nov 6 (Reuters) - U.S. crude futures rose by more than $1 a barrel on Wednesday, rebounding from four-month lows on unexpectedly large falls in U.S. fuel supplies.

The U.S. benchmark's discount to European Brent crude narrowed by $2 to a low of just under $10 during the session.

Brent reversed gains in late trading to finish lower, after finding support for most of the session on concerns about prolonged supply outages in Libya as the peak northern hemisphere winter heating season looms.

"We were up strong all day. really bought the market after the Department of Energy report, so probably some money got taken off the table," said Stephen Schork, editor of the Schork Report in Villanova, Pennsylvania.

December Brent fell even as contracts for next year largely gained, dragging the market into a contango structure for the first time since June and suggesting that weeks of weakness in U.S. physical crude oil markets is spilling over into the European and global markets.

"It speaks to a market eyeing a well-supplied situation at the moment," said John Kilduff, a partner at Again Capital LLC in New York.

"It seems that refiners, particularly in Europe, are struggling and it looks to continue. That's a very bearish signal."


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