Oil Jumps as Turkey’s Military Move Outweighs Bearish Data

09/10/2019 16:16:50 Commodities

Investing.com – Record crude output for the U.S. wasn’t enough to stop oil prices climbing in the face of more upheaval in the Middle East Wednesday.

Turkey launched an invasion of northern Syria in pursuit of Kurdish militias that it suspects of helping separatists within Turkey. The operation began with massed air raids, including against civilian targets, according to a spokesman of the Kurdish-led Syrian Defense Force, quoted by MCNBC.

WTI futures rose 1.9% to $53.61 at 12:18 PM ET (16:18 GMT).

Global benchmark Brent rose 1.6% to $59.16.

Looking to the data, the latest report from the Energy Information Administration said that U.S. crude output rose to a record high of 12.6 million barrels per day last week.

That’s “remarkable considering the U.S. rig count is at a two-year low,” Investing.com analyst Barani Krishnan said.

The EIA also said crude inventories rose by about 2.9 million barrels for the week ended Oct. 4.

Analysts were expecting a rise of 1.4 million, according to forecasts compiled by Investing.com.

Gasoline inventories sank by 1.2 million barrels, versus expectations for a drop of about 260,000. Distillate stockpiles dropped by about 3.9 million barrels, compared with forecasts for a decline of about 2.1 million.

“This is a pretty interesting dataset in the sense that it shows a fourth-straight week of crude builds, which are perfectly in line with post-driving season trends, while fuel inventories continue to collapse, surprising even bears in the market,” Krishnan added.

“Refinery runs remain at least 10% below norm, which might explain the crude build,” he said. “But imports were steadily under 7 million bpd and exports seem to be heading toward the 3.5 million bpd mark next.”