Crude oil futures surged higher on Wednesday based on favorable news suggesting a larger-than-expected drawdown in gasoline and crude inventories, according to Bloomberg MarketWatch.
September West Texas Intermediate crude jumped $1.32, or 3.3%, to settle at $40.83 a barrel on the New York Mercantile Exchange. The U.S. benchmark plunged after the U.S. Energy Information Administration weekly data report revealed an unexpected 1.4 million barrel uptick in crude oil inventories.
Traders were bolstered by the news of a significant yet unexpected reduction of 3.3 million barrels in gasoline inventories coupled with a 1.1 million barrel decrease in crude inventories in Cushing, Oklahoma.
“The mantra was that we have this glut of products, so the drop in gasoline inventories changed the complexion,” said Phil Flynn, senior market analyst at Price Futures Group in Chicago.
On the London ICE Futures Exchange, October Brent crude, the global benchmark, surged $1.30, or 3.1%, to end trading at $43.10 a barrel.
Meanwhile, September natural gas contracts rose 10.6 cents, or 3.9%, to settle at $2.839 per million British thermal units on the New York Mercantile Exchange.