Forexpros – Crude oil futures advanced for a fifth day on Wednesday, trading close to the previous session’s three-month high as speculation China could loosen monetary policy in the near-term alleviated concerns ahead of a critical European Union summit later in the day.
On the New York Mercantile Exchange, light, sweet crude futures for delivery in December traded at USD93.44 a barrel during European morning trade, climbing 0.87%.
It earlier rose by as much as 1.1% to trade at a daily high of USD93.89 a barrel. Prices rose to USD94.57 a barrel on Tuesday, the highest since August 2.
Earlier in the day, Chinese Premier Wen Jiabao said that economic policy will be “fine-tuned as needed”, while adding that, “officials will make adjustments at a suitable time and by an appropriate degree.”
The comments boosted speculation that Beijing could ease monetary policy to support economic growth in the world’s second largest oil consumer.
Meanwhile, EU leaders will meet for the second time in four days later Wednesday in an effort to reach agreement on measures to boost the size the region’s rescue fund, recapitalize banks and restructure Greek sovereign debt.
Crude prices found further support after the U.S. National Hurricane Center said that Hurricane Rina strengthened to a Category 3 hurricane with winds of 110 miles per hour as it headed towards Mexico’s Yucatan Peninsula, home to a number of major oil platforms.
Energy traders track tropical storm activity in the event it disrupts production in the Gulf of Mexico, which is home to 29% of U.S. oil production.
Markets were awaiting weekly government data on U.S. stockpiles of crude and refined products to gauge the strength of oil demand in the world’s largest oil consumer.
The report was expected to show that U.S. crude oil stockpiles rose by 0.8 million barrels last week, while gasoline supplies were forecast to fall by 1.0 million barrels.
After markets closed Tuesday, the American Petroleum Institute, an industry group, said that U.S. crude inventories rose by 2.71 million barrels last week, while total gasoline supplies added 0.15 million barrels.
Elsewhere, on the ICE Futures Exchange, Brent oil futures for December delivery shed 0.35% to trade at USD110.53 a barrel, with the spread between the Brent and crude contracts narrowing to USD17.14 a barrel, the lowest since early July.
Brent prices came under pressure after Libya’s interim oil minister Ali Tarhouni said that the country’s oil output reached 500,000 barrels per day, following the resumption of operations at the Sharara field.
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