Oil gains as inventories fall

WTI crude traded higher in the early part of the Asian trading session, supported by expectation of declining stockpiles. According to the American Petroleum Institutes industry report crude reserves shrank by 7,8 million barrels in the week ending June 2. Gasoline stockpiles decreased by 1.3 million barrels, but distillate supplies rose by 241 000 barrels.

On the New York Mercantile Exchange, WTI crude for July delivery traded at $93.63 a barrel at 6:27 GMT, up 0,34% on the day. Future prices settled 0,68% higher on Tuesday.

The Energy Information Administrations report, scheduled to be released today, is expected to show an 800 000 barrels decline in Crude Oil Inventories, according to a Bloomberg survey of analysts. The survey also shows distillate inventories are expected to have gained 1.4 million barrels.

Michael McCarthy, a chief market strategist at CMC Markets in Sydney said for Bloomberg: “The fall in inventories seems to have supported the market. It will be surprising to see any major moves ahead of that potentially game-changing data from the U.S. and China”.

The Energy Information Administration said U.S. oil production in the U.S. jumped 26% in the last two years and may exceed imports in 2013, based mainly on the shale oil boom.

Also, the U.S. will extend waivers for nine nations that import Iranian oil from sanctions. China, India, Singapore, South Africa, South Korea, Sri Lanka, Malaysia, Turkey and Taiwan will have their sanction exemptions extended as the countries have met the requirements of significantly reducing their oil imports from Iran.

Market players are looking into U.S. economic data, scheduled for release on Friday. Average hourly earnings, change in non-farm payrolls and unemployment rate are expected to be little changed compared to the preceding periods. If values mismatch predictions towards negative readings, this could influence oil prices, as those major indicators represent the economic activity of the biggest oil consumer that accounts for 22% of the global consumption.