(For Bloomberg fair value curves, see CFVL <GO>)
Dec. 3 (Bloomberg) -- West Texas Intermediate rose for a third day amid forecasts crude stockpiles dropped last week for the first time since September in the U.S., the world’s biggest oil consumer.
Futures climbed as much as 0.5 percent in New York after data yesterday showed U.S. manufacturing accelerated more than estimated. Crude inventories shrank by 700,000 barrels, the first decline in 11 weeks, according to a Bloomberg News survey before a government report tomorrow. The global oil market is “in equilibrium,” Saudi Arabian Oil Minister Ali al-Naimi said as the Organization of Petroleum Exporting Countries prepared to discuss its production quota in Vienna.
“Economic recovery is with us,” said Jonathan Barratt, the chief executive officer of Barratt’s Bulletin in Sydney who forecasts investors may sell WTI contracts at $94.50 a barrel. “The inventory builds scared the market,” he said, predicting OPEC will maintain its output target.
WTI for January delivery gained as much as 42 cents to $94.24 a barrel in electronic trading on the New York Mercantile Exchange, and was at $94.08 at 3:52 p.m. Singapore time. The contract increased $1.10 to $93.82 yesterday, the highest close since Nov. 25. The volume of all futures traded was about 52 percent below the 100-day average. Prices have advanced 2.5 percent this year.
Brent for January settlement was up 1 cent at $111.46 a barrel on the London-based ICE Futures Europe exchange. The European benchmark crude was at a premium of $17.38 to WTI futures, compared with $17.63 yesterday.
WTI fell 2.2 percent last week, the seventh loss in eight weeks, as U.S. crude stockpiles expanded amid a surge in production. Output rose to 8.02 million in the seven days ended Nov. 22, the fastest rate in almost 25 years, according to the Energy Information Administration, the Energy Department’s statistical arm.
Gasoline supplies probably climbed by 1.25 million barrels in the week through Nov. 29, according to the median estimate of eight analysts surveyed by Bloomberg before the EIA report. Distillate inventories, including heating oil and diesel, are projected to have decreased by 1.15 million.
Refinery utilization advanced by 0.7 percentage points to an average 90.1 percent of capacity, the highest since September, the survey shows. The American Petroleum Institute is scheduled to release separate supply data today. The industry group in Washington collects information on a voluntary basis from operators of refineries, bulk terminals and pipelines. The government requires that reports be filed with the EIA.
Manufacturing in the U.S. expanded in November at the fastest pace in more than two years, the Institute for Supply Management’s index showed yesterday. The reading of 57.3, which topped a median economist forecast for 55.1, follows gains in China and Europe.
The U.S. will account for about 21 percent of global oil demand this year, compared with 11 percent for China, the second-largest consumer, according to the International Energy Agency, a Paris-based adviser to developed nations.
Brent, the benchmark grade for half the world’s crude, increased for a second month in October as unrest curbed output from Libya. The OPEC member is the holder of Africa’s biggest oil reserves.
OPEC ministers meeting tomorrow will probably maintain their 30 million barrel-a-day target as demand for the group’s crude may remain near current levels in 2014, said three delegates who spoke on condition of anonymity because the discussions are private. Saudi Arabia pumps almost a third of the oil from the group’s 12 members.
--Editors: Yee Kai Pin, Pratish Narayanan