Investing.com – Crude oil prices gained in Asia on Wednesday as industry estimates of U.S. inventories boosted sentiment and an on target PMI reading in China soothed concerns of a slowdown.
The Caixin/Markit manufacturing PMI for October came in at 51.0 as and unchanged from September, according to data released on Wednesday. The release follows China’s official manufacturing PMI for October that came in at 51.6 — below expectations.
On the New York Mercantile Exchange crude futures for December delivery rose 0.51% to $54.66 a barrel, while on London’s Intercontinental Exchange, Brent added 0.48% to 61.23 a barrel.
Crude oil stocks fell by 5.087 million barrels last week, the American Petroleum Institute (API) said on Tuesday, while gasoline supplies dropped 7.697 million barrels and distillates declined 3.106 million barrels.
Supplies at the oil storage hub of Chushing, Oklahoma, fell by 263,000 barrels.
Analysts expected a 2.575 million barrels drop in crude, a 2.450 million barrels decline in distillates and a 2.050 million barrels dip in gasoline supplies.
The API estimates are followed by official data from the Energy Information Administration (EIA) on Wednesday. The EIA and API figures often diverge.
Overnight, crude oil prices settled higher on Tuesday as investors looked ahead to inventory data expected to show crude supplies fell last week amid ongoing optimism that OPEC will agree to extend output cuts.
With the upcoming OPEC November meeting edging closer, oil prices added to recent gains as investors continued to expect OPEC will extend output cuts through March 2018 amid recent comments from OPEC Secretary General Mohammad Barkindo.
“OPEC welcomes the clear guidance from the crown prince of Saudi Arabia on the need to achieve stable oil markets and sustain it beyond the first quarter of 2018,” Barkindo said, referring to recent comments from Saudi Arabian Crown Prince Mohammed bin Salman.
Saudi Arabia Crown Prince Mohammed bin Salman said last week, the kingdom would support extending output cuts in order to rid the market of excess supplies.
In May, OPEC producers agreed to extend production cuts for a period of nine months until March, but stuck to production cuts of 1.2 million bpd agreed in November last year. OPEC is slated to next meet at its headquarters in Vienna on Nov. 30.
In the U.S. meanwhile, traders looked ahead to fresh inventory data from the American Petroleum Institute on Tuesday as well as a further report from EIA on Wednesday expected to show a decrease in domestic crude inventories.