NYMEX crude oil futures ended higher on Wednesday amid late buying by funds despite government data showing U.S. crude oil and gasoline inventories rose last week, traders said.
Dealers said that, despite the generally bearish inventory data, recent sharp declines in the price of crude helped limit losses on the supply gains and allowed for the late price reversal.
Investors were also wary of being too short with another long weekend ahead and the Middle East region vulnerable to supply disruptions from violence.
The NYMEX will be shut Friday for a national day of mourning for former President Ronald Reagan, who died Saturday.
“The fact that we ended higher, despite the data, may be a sign the downturn has had some of the steam taken out,” said Nauman Barakat, senior vice president at Refco. “There was some bottom feeding by the funds.”
U.S. commercial crude inventories rose by 400,000 barrels to 302.1 million barrels in the week to June 4, the U.S. Energy Information Administration said in its weekly report on Wednesday morning. The build was less than the average of 1.6 million barrels analysts predicted in a Reuters poll.
July crude settled up 26 cents at $37.54 a barrel, having traded as low as $36.45. Analysts had charted support at $36.10, with resistance at $39.
In London, July Brent settled up 24 cents at $35.29 a barrel.
July gasoline settled up 0.10 cent at $1.1673 a gallon, trading as low as $1.1320 after the EIA showed stocks up 2.1 million barrels to 206.4 million, only slightly more than expected.
Although refiners operated at 96 percent of capacity last week, gasoline production declined by 128,000 barrels per day to an average of 8.7 million bpd. Imports were up 38,000 bpd to more than 1 million bpd.
Gasoline demand over the past four weeks has averaged more than 9.1 million bpd, or 0.4 percent above the same period last year, the EIA said.
Gasoline futures have been in retreat from the $1.3810 July contract high, which was under the all-time record $1.47 hit by the June contract on May 20.
July heating oil settled up 1.96 cents at 98.07 cents a gallon, trading from 94.50 cents to 98.40 cents. Support was charted at 91.65 cents, with resistance at 96.25 cents. The EIA showed distillate supplies down by 600,000 barrels.
A separate report by the American Petroleum Institute, an industry group, showed crude stocks up 2.7 million barrels, gasoline up 4.7 million barrels and distillate up 1.7 million.
The oil complex has been feeling pressure after OPEC last week raised its production quotas and Saudi Arabia, Kuwait and the United Arab Emirates promised 1 million bpd of new oil above current quota-busting output.
Crude prices have retreated from the 21-year and all-time NYMEX record of $42.45 reached last week.
A suspected bomb blast in Germany and attacks shutting U.S.-occupied Iraq’s pipeline from its northern fields to Turkey helped highlight the market’s security worries.
More potential support could come from Wednesday’s general strike in Nigeria. The strike was called to protest fuel price increases, but was not affecting oil exports as yet, according to oil and industry sources.