Oil rally boosted by surprise fall in U.S. stocks

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Oil rose for a fifth day on Thursday after a surprise fall in U.S. crude inventories gave further legs to a rally driven by optimism that vaccines will end the coronavirus pandemic and revive demand for fuels.

Brent futures were up 45 cents, or 0.9%, at $49.06 a barrel by 0245 GMT, after rising around 1.6% in the previous session. West Texas Intermediate crude was up by 34 cents, or 0.7%, at $46.05 a barrel, having gained 1.8% on Wednesday.

Both benchmarks have risen about 9% this week, getting a boost after AstraZeneca said on Monday its COVID-19 vaccine could be up to 90% effective, adding to the potential armoury to end the worst pandemic in a century. Encouraging vaccine results are “pushing aside concerns of enduring containment measures and prompting some follow-through buying from the speculative community,” Citigroup Global Markets said in a note.U.S. oil stockpiles fell 754,000 barrels last week, data showed, while analysts in a Reuters poll had predicted a 127,000-barrel rise. Stockpiles at the Cushing, Oklahoma, delivery point for WTI, fell by 1.7 million barrels.

But gasoline demand for the week fell by 128,000 barrels per day to 8.13 million bpd, the lowest since June. U.S. President-elect Joe Biden has urged people to forgo big family gatherings, wear protective masks and maintain social distancing for the Thanksgiving holiday in the face of the surging coronavirus pandemic. But Americans are defying pleas from officials to stay home.Reporting by Aaron Sheldrick; Editing by Himani Sarkar and Richard Pullin

 

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