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© Reuters. Crude oil storage tanks are seen in an aerial photograph at the Cushing Oil Center
By Yuka Obayashi and Dmitry Zhdannikov
TOKYO / LONDON (Reuters) – Oil prices fell on Thursday, but remained well above $ 50 a barrel in a slight Christmas trade, as a drop in US stocks boosted demand hopes, while prices Signs of an imminent Brexit deal bolstered investors’ risk appetite.
futures were down 30 cents, or 0.6%, to $ 50.90 a barrel at 1100 GMT, while U.S. West Texas Intermediate (WTI) crude was down 34 cents, or 0.7%, to $ 47.70.
Both contracts gained more than 2% on Wednesday.
“Lower US crude and fuel inventories, as well as signs of a possible Brexit deal that led to a weaker US dollar, was good news,” said Hiroyuki Kikukawa, general manager of research at Nissan (OTC 🙂 Securities.
“But lingering concerns about a new variant of the novel coronavirus limited earnings,” he said, adding that oil markets were quiet with investors on vacation mode.
Inventories fell 562,000 barrels in the week of Dec. 18 to 499.5 million barrels, the Energy Information Administration (EIA) said on Wednesday.
Gasoline stocks fell by surprise 1.1 million barrels to 237.8 million barrels, the EIA said, while distillate stocks fell 2.3 million barrels more than expected to 148.9 million barrels.
Oil prices were also supported by news that Britain and the European Union were on the verge of reaching a tight trade deal, moving away from a chaotic end to the Brexit split.
“Risk appetite among investors also improved due to a rally in global equities, which underscored that fears about a new variant of the coronavirus have receded somewhat,” said Satoru Yoshida, commodities analyst at Rakuten Securities.
At least four pharmacists hope their COVID-19 vaccines will be effective against the new, fast-spreading variant of the virus that is wreaking havoc in Britain, and they are running tests that should provide confirmation in a few weeks.
On the supply side, US energy companies added oil and rigs this week for the fifth week in a row.
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