Oil surges after first US hub stock draw in 5 months

NEW YORK — Oil prices hit the highest this year, so far, on Wednesday after the first crude stock draw in five months at the US Cushing, Oklahoma hub suggested an oil glut may be starting to ease.

Government data showing a smaller- than- expected rise last week in crude inventories throughout the United States also aided sentiment, although some traders felt the market was ignoring bearish elements like higher production.

Oil has staged its strongest recovery this month since a sell-off that began in June last year.

US crude futures are poised to end April up nearly 23% and Brent almost 20% higher, the biggest monthly gains since May 2009 when the global economy was starting to rebound from the financial crisis.

Prices settled up about 2% or more on Wednesday, with early strength coming from a leadership reshuffle announced at Saudi national oil company Aramco.

US crude futures closed up $1.52 at $58.58 a barrel, after hitting a 2015 high of $59.33.

Futures of Brent crude, the more widely used benchmark, finished up $1.20 at $65.84 after hitting its year high at $66.72.

The rise was driven partly by the notion the supply glut that caused prices to fall by half since last summer may be easing with higher demand projected ahead of the peak US driving season.

Government data showed that US crude inventories rose last week to hit a record high for the 16th straight week. But the build of 1.9 million barrels was smaller than the 4.2 million barrels cited by industry group the American Petroleum Institute and a forecast of 2.3 million in a Reuters poll.

Crude stocks at Cushing — the delivery point for US crude futures — fell by 514,000 barrels, marking the first decline since November. US weekly crude production also rose slightly. —