Crude Oil Settles Higher After Supply Data

(RTTNews) - U.S. crude oil snapped a three-day loss to settle higher Thursday in a last minute rally, after official data from the Energy Information Administration showed crude stockpiles in the U.S. to have declined more than expected last week, although production continued to remain firm.

Earlier today, a weekly report from the U.S. Energy Information Administration said U.S. crude oil inventories dropped 2.8 million barrels in the week ended May 22, while analysts expected a decline of 1.8 million barrels. This is the fourth straight week of decline for crude oil inventories.

The report showed U.S. crude oil inventories at 479.4 million barrels end last week.

Nonetheless, the EIA said oil production in the U.S. climbed to 9.57 million barrels a day, compared to the output of 9.26 million a week earlier.

Gasoline stocks dropped 3.3 million barrels last week, while inventories of distillate, including heating fuel, rose 1.1 million barrels.

Data from the oil and gas industry trade group American Petroleum Institute late Wednesday showed U.S. crude oil stocks to have gained 1.3 million barrels last week.

Meanwhile, industry research group Baker Hughes reported that the number of rigs actively drilling for oil in the U.S. dropped by one last week to 659.

Oil prices have been fluctuating around $60 a barrel, capped by surging global inventories and renewed strength of the U.S. dollar. OPEC is expected to formulate a policy response to the surging inventories at its June 5 meeting in Vienna.

Tensions in the Middle East, particularly surrounding the conflict in Yemen and ISIS gains in Iraq, have kept crude oil prices afloat.

Light Sweet Crude Oil futures for July delivery, the most actively traded contract, gained $0.17 or 0.3 percent, to settle at $57.68 a barrel on the New York Mercantile Exchange Thursday.

Crude prices for July delivery scaled a high of $58.04 a barrel intraday and a low of $56.51.

On Thursday, crude oil for July delivery dropped $0.52 or 0.9 percent, to settle at $57.51 a barrel, on a strong dollar and ahead of the official crude oil weekly inventory data from the Energy Information Administration.

The dollar index, which tracks the U.S. unit against six major currencies, traded at 97.04 on Thursday, down from its previous close of 97.30 on Wednesday in late North American trade. The dollar scaled a high of 97.63 intraday and a low of 96.96.

The euro trended higher against the dollar at $1.0936 on Thursday, as compared to its previous close of $1.0905 in North American trade late Wednesday. The euro scaled a high of $1.0953 intraday and a low of $1.0870.

On the economic front, a Labor Department report on Thursday showed another uptick in initial jobless claims in the week ended May 23, after reporting a modest increase in first-time claims for U.S. unemployment benefits in the previous week. Initial jobless claims edged up to 282,000, an increase of 7,000 from the previous week's revised level of 275,000. Economists expected jobless claims to dip to 270,000 from the 274,000 originally reported for the previous week.

A report from the National Association of Realtors on Thursday showed pending home sales in the U.S. increased by much more than expected in the month of April, with sales jumping to their highest level in nearly nine years. NAR said its pending home sales index surged 3.4 percent to 112.4 in April from a slightly upwardly revised 108.7 in March. Economists expected the index to increase by about 0.8 percent.

Eurozone economic confidence remained unchanged at its second highest level in nearly four years in May despite the ongoing Greek crisis, survey results from the European Commission showed Thursday. The economic sentiment index held steady at 103.8 in May, while it was forecast to fall to 103.5. This was the second highest score since July 2011. The April figure was revised up from 103.7.

Germany's import prices continued to fall in April but at a slower than expected pace, data from Destatis revealed Thursday. Import prices fell 0.6 percent year-on-year in April, slower than the expected decrease of 0.7 percent and 1.4 percent decline seen in March.

The U.K. economy grew at a slower pace as initially estimated in the first quarter, second estimates published by the Office for National Statistics showed Thursday. Gross domestic product expanded 0.3 percent in the first quarter, which was weaker than the 0.6 percent seen a quarter ago. This was the slowest growth since the fourth quarter of 2012.