FX.co ★ Crude Oil Futures Extend Recent Gains, Settle Sharply Higher

Crude oil prices climbed higher on Wednesday, rising for the third consecutive session, on concerns over tightening supply.

Data showing a larger than expected drop in crude inventories in the U.S. last week pushed up oil prices.

Oil prices were also supported by a warning from Saudi Arabia's energy minister on Tuesday that oil prices may not continue to decline.

West Texas Intermediate Crude oil futures for July ended higher by $1.43 or about 2% at $74.34 a barrel.

Brent crude futures settled at $78.36 a barrel, gaining $1.52 or about 2%.

Data released by the Energy Information Administration (EIA) this morning showed crude inventories fell by 12.456 million barrels in the week ended May 19.

Gasoline inventories fell 2.053 million barrels last week, as against forecasts for a drop of 0.695 million barrels. Meanwhile, distillates stockpiles fell by a modest 0.562 million barrels, as against forecasts for an increase of 0.057 million barrels.

Analysts expect oil prices to stay elevated amid supply concerns after reports emerged that OPEC and allies might consider another cut in production at a meeting on June 4.

The North American oil supply has already been squeezed by Canadian wildfires and there are expectations of a surge in road trips in the U.S. beginning with next Monday's Memorial Day holiday.