Commodity News
HeadLine : NYMEX crude up in Asia as market focuses on China, India, demand outlook
Date : Mar 5 2015
Crude oil prices gained in early Asia on Thursday, shrugging of a surge in U.S. stockpiles and focused on signs of demand globally on moves by importing giants China and India to cut interest rates in the past week.

On the New York Mercantile Exchange, WTI crude oil for April delivery rose 0.24% to $51.66 a barrel.

On Wednesday, India's central bank lowered its interest rate 0.25% to 7.5%, marking its second rate cut in months.

The move came days after China announced over the weekend that it will be undertaking easing measures with its benchmark interest rate.

Overnight, oil prices fell sharply on Wednesday after U.S. data indicated that oil supplies nationwide reached the highest level ever, aggravating concerns that an even steeper drop could be imminent.

The U.S. Energy Information Administration (EIA) said in its weekly report that crude oil inventories rose by 10.3 million barrels for the week that ended Feb. 26, marking the largest weekly increase since 2002.

Weekly inventory increases have been the norm of late. A week earlier, U.S. crude oil inventories rose by 8.4 million barrels for the week that ended Feb. 19 – more than doubling forecasts of a 4.0 million weekly increase.

At the Cushing Oil Hub in Oklahoma, inventory levels have reached 49.2 million barrels, a 53% increase from the weekly level at this time last year.

The current level at the nation's largest hub for WTI crude oil is only 2.5 million barrels below the storage facility's all-time record high. It has been estimated by analysts that Cushing could reach full capacity as early as next month – raising fears that WTI crude could drop to as low as $20 a barrel.

Meanwhile, Brent oil prices for April delivery on Wednesday dropped 2.25% or 1.37 points to $59.65 a barrel. The mid-week slide underscored a period of recent volatility where daily oil prices have moved more than 2% in an up or down direction in 27 of the last 40 trading days.

The spread between brent and WTI crude in afternoon trading hovered in between $9.76 and $9.87 a barrel. Earlier on Monday, the spread reached $13 a barrel.

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