Oil prices were up almost 3% yesterday, bringing back hope to the market, following previous concerns after Britain voted to leave the European Union.
The market was buoyed by a U.S. government report, which revealed a bigger than predicted weekly reduction in crude oil inventories, although the market was already beginning to pick up in the wake of Brexit anyway.
Other factors that contributed to the increase in crude prices were a possible strike by oil workers in Norway and an energy sector crisis in Venezuela.
The U.S. Energy Information Administration noted that crude stockpiles were down 4.1m barrels in the week up to 24 June, making for six weekly drawdowns in a row.
This figure was significantly higher than the 2.4m barrels that analysts expected to see when asked in a poll carried out by Reuters.
Late on Tuesday, The American Petroleum Institute released figures equating to a 3.9m-barrel drawdown, and this was also a huge factor in boosting crude oil futures.
Speaking to Reuters about the issue, Again Capital partner John Kilduff said:
“The report is bullish with the large crude oil inventory decrease of over four million barrels. The stepped-up demand by refiners and a plunge in imports helped create the decline.”
Any improvement in oil prices is good news for oil giants like Shell and Exxon Mobil, who are well known for products including Mobil Unirex EP2 and Shell Tellus S2 M 32 respectively, and will provide a welcome boost to the world’s biggest oil producers.