New York, Jan 10: Oil surged to the highest intraday level since December 2014 amid optimism global markets are finally tightening. Futures extended gains to as much as 1.7 percent in New York. A key U.S. government report on Wednesday is expected to show crude stockpiles dropped for an eighth straight week. That would be the longest decline for this part of the year since the winter of 2007-2008. “Production cuts and demand are continuing to rebalance the market. As we break through technical levels, you’re getting further speculative length coming into the market,” Gene McGillian, a market research manager at Tradition Energy in Stamford, Connecticut, said by telephone.
Oil in New York has traded above $60 a barrel and the international benchmark Brent has held above $66 since December as the Organization of Petroleum Exporting Countries and allied suppliers capped output. West Texas Intermediate for February delivery jumped 88 cents to $62.61 a barrel at 11:58 a.m. on the New York Mercantile Exchange after touching $62.80. Brent for March settlement climbed 75 cents to $68.53 on the London-based ICE Futures Europe exchange. The global benchmark crude traded at a premium of $5.90 to March WTI. US crude stockpiles at the Cushing, Oklahoma, pipeline hub probably fell by 1.5 million barrels last week, according to a forecast compiled by Bloomberg. Inventories at Cushing dipped below 50 million barrels through the week ended Dec. 29, the first time they have dropped below that level since February 2015, according to the most recent Energy Information Administration data.