VIENNA, Austria, AP – Oil prices rebounded Thursday, recovering all their losses from the previous day, after U.S. government data showed domestic supplies of oil and gasoline shrank last week.
Part of the supply declines — and price upswing — was linked to stronger than expected refinery runs that looked to bring output to highs not seen since last summer.
Light, sweet crude for May delivery gained 42 cents to $62.19 a barrel in electronic trading on the New York Mercantile Exchange. On Wednesday, crude futures fell 57 cents to settle at $61.77 a barrel, dragged down by a steep drop in gasoline futures.
May Brent crude futures on ICE Futures in London traded at $62.08 a barrel, up 58 cents.
Gasoline rose 0.55 cents to $1.7420 a gallon after plunging 10.3 cents, or 6 percent, on Wednesday.
Heating oil was steady at $1.7442 a gallon, while natural gas gained 5.6 cents to $7.009 per 1,000 cubic feet.
In its latest weekly report, the U.S. Energy Department said Wednesday that domestic inventories of crude oil declined by 1.3 million barrels last week to 338.6 million barrels, or 9 percent above year-ago levels. The agency said gasoline inventories fell by 2.3 million barrels to 221.6 million barrels, or 1 percent higher than last year.
The supply of distillate fuel, which includes diesel and heating oil, shrank by 800,000 barrels to 126.7 million barrels, or 15 percent above year-ago levels, the Energy Department said.
Vienna’s PVM Oil Associates focused on increasing refinery output as the catalyst for the market. Extra production due to the approaching summer driving season and plans by BP to resume production at its facility in Texas City, Texas, by June means “total refinery runs are likely to cross the 5-year average again, which would be the first time since August last year,” it said.
Prices had been supported in recent weeks by persistent concerns over supply disruptions in Nigeria, where rebels have struck an oil pipeline operated by Rome-based Eni SPA’s Agip Oil Co. unit, as well as the potential threat of United Nations Security Council action against Iran over its nuclear ambitions.
The five permanent members of the U.N. Security Council have been debating since last week what action the council should take after the U.N. nuclear watchdog referred Iran, OPEC’s No. 2 oil producer, to the body.
The United States accuses Iran of seeking to develop nuclear weapons, a charge denied by Tehran, which says its program aims only to generate electricity.