Markets across the globe got a boost from confirmation by incoming Federal Reserve chief Janet Yellen that the U.S. central bank’s loose monetary policy was here to stay.
International benchmark Brent crude found additional support amid concerns disruptions from Libya could tighten global oil markets.
The International Energy Agency (IEA) said the market currently looked well supplied, but that the production problems in Libya and Iraq, as well as increased demand from the Northern Hemisphere’s winter, could lift prices following recent weakness.
U.S. RBOB gasoline futures led the complex higher, however, up 2.8 percent on supply concerns. Seasonal refinery maintenance has cut into output of the fuel, and government data released on Thursday showed U.S. inventories fell for the fifth straight week in the week to Nov. 8.
“The momentum is coming from this speech and gasoline is up big,” said Bill Baruch, senior market strategist at iitrader.com in Chicago.
Brent for December delivery traded up $1.56 to $108.68 a barrel at 1:01 p.m. EST (1801 GMT), breaking above its 200-day moving average for the first time in almost two weeks. The contract has rallied by more than 5 percent since hitting a 4-month low near $103 a barrel last week, supported by the supply outages in Libya.
U.S. crude rose 33 cents to $94.21 a barrel, after settling up by 84 cents on Wednesday.
Rising U.S. crude oil inventories helped keep a lid on U.S. crude’s gains relative to Brent, with Brent’s premium to the U.S. contract widening out to $15.87 — the highest level since March — at one point.
The U.S. Energy Information Administration (EIA) reported crude oil inventories in the world’s largest oil consumer rose by 2.6 million barrels, far more than the 1 million barrels predicted by analysts. Stocks at the Cushing, Oklahoma storage hub, delivery point for the U.S. crude oil contract, rose by 1.7 million barrels.