US Oil Prices Rise amid Sharp Decline in Crude Reserves

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  • AP/Sue Ogrocki

    AP/Sue Ogrocki

    TEMPO.CO, Jakarta - Crude oil prices went up on Thursday morning, Jakarta time, after the United States (US) oil supplies sharply dipped amid higher outputs from Libya, which caused oil prices in London to slide. 

    The price for November deliveries of the US benchmark—the light sweet crude oil, also known as the West Texas Intermediate (WTI)—rose by US$1,24 to US$92,80 per barrel at the end of trading at the New York Mercantile Exchange, according to AFP observation. 

    Meanwhile, the price for November deliveries of the European benchmark—the Brent crude oil —was up by 10 cents to US$96,95 per barrel at the end of trading in London, after dipping to a two-year low at the beginning of the trading session.

    The US Department of Energy said its reserves of crude oil slid by 4,3 million barrels in the week ending on September 19—500,000 more than experts projected in a survey conducted by Dow Jones Newswires.

    The DoE report also indicated petrol reserves dropped by 410,000 barrels, more than twice than initial projections by analysts.

    "Outgoing demand is more bullish than many experts had expected," said Oliver Sloup from iiTrader.

    Previously, the prices of Brent crude slid to a two-year low during yesterday's early trading session. The price fell to US$95,60 per barrel due to fears of declining demands amid abundance of reserves, according to an analyst from Schneider Electric, Matt Smith.

    European contracts were also hit by reports that Libya had managed to resume production at Sharara oil fields, the largest oil field in Libya, and it was not helped by reports of the fifth-consecutive decline in business sentiments in Germany, which went down to 104,7 in September—the lowest point since April 2013.

    However, Brent crude prices recovered at the end of the session and rallied 30 minutes before trading closed amid unconfirmed reports of a bombing in Libya's east, which also helped prop up the price of the WTI at the end of trading in New York.