Despite data showing a surge in U.S. crude inventories last week and lingering worries about outlook for energy demand, crude oil futures settled sharply higher on Wednesday, rebounding strongly after suffering some sharp losses earlier in the week.
Data showing a drop in crude stockpiles at the storage hub in Cushing, Oklahoma to lowest level in about seven months supported oil prices.
West Texas Intermediate crude oil futures for September ended up by $3.10 or about 4.6% at $70.30 a barrel. WTI crude futures gained about 1.3% on Tuesday, after declining by nearly 7.5%, the biggest drop in the year, on Monday.
Data released by Energy Information Administration (EIA) this morning showed crude inventories in the U.S. rose by about 2.1 million barrels last week, as against expectations for a 4.5 million drop.
The EIA data also showed gasoline stockpiles dropped by 100,000 barrels last week, while distillate stockpiles declined by about 1.3 million barrels.
Crude oil prices tumbled earlier in the week after the Organization of the Petroleum Exporting Countries and allies, collectively known as OPEC+, decided to boost supply by 400,000 barrels per day from August through December.