U.S. West Texas Intermediate and international-benchmark Brent crude oil futures closed higher this holiday-shortened week, supported by a larger-than-expected drawdown in crude inventories earlier in the week and a decline in the U.S. unemployment rate.
However, gains were capped and there was an air of caution ahead of the long holiday weekend as a resurgence in U.S. coronavirus infections fanned concerns that economic activity will weaken in coming weeks.
Drop in Supply Underpins Prices
Helping to underpin crude oil prices this week were a pair of bullish reports from the American Petroleum Institute (API) and the Energy Information Administration (EIA).
The API reported on Tuesday a major draw in crude oil inventories of 8.156 million barrels for the week-ending June 26. Analysts had predicted an inventory draw of 710,000 barrels.
The API also reported a draw of 2.459 million barrels of gasoline for the week-ending June 26. Analysts were looking for a 1.583-million barrel draw for the week. Distillate inventories were up by 2.638-million barrels for the week, while Cushing inventories saw a build of 164,000 barrels.