Oil prices rise despite US stockpile data on China demand and Nigerian production problems


Oil prices have been gushing for three days now (Source: Getty)

Oil prices have risen for a third consecutive day today, hitting eight month highs. 

The rise is in spite of US data showing a surprise build in petrol stockpiles. On-going production problems in Nigeria, as well as a better outlook for demand in China spurred on the market. 

Gasoline stocks added one million barrels. Analysts had pencilled in a fall. 

Inventories of crude oil in the US however fell by more than analysts had expected dropping by 3.2m barrels, over forecasts of 2.7m, in the week to 3 June. 

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Brent crude climbed to $52.35, while West Texas Intermediate hit $51.13. The gains boosted the FTSE 100, which scored its fourth consecutive day of gains

In China crude oil imports hit their highest in more than six years in May. In Nigeria the Niger Delta Avengers militant group attacked the county's Chevron oil well.

The oil price continues to climb despite US shale production still holding up far better than many had expected, and the former oil cartel Opec tearing itself apart over production disagreements. 

Craig Erlam, senior market analyst at Oanda, said: 

It would appear that the rebalancing of the oil markets is very much underway, the only questions now are how temporary these supply disruptions are and how high prices can go.

While I do think WTI could continue to grind higher for now, I do think it’s going to find significant resistance around $54.50-55. A move above this level would be quite bullish.

It will be interesting to see if the EIA crude inventory figures confirm yesterday’s API release, which could be the catalyst for further gains in oil later on today.

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Oil is up from 13-year lows of $27 per barrel in February, though remains well under its highs of $114 in the Summer of 2014.