Prices soar and touch $84 mark during the week on Energy Department report
Crude-oil future prices for sweet light crude for November delivery which had ended at $81.22/bbl last week (05 October) finished $2.47 (3%) higher this week (12 October) at $83.69/bbl. Prices continued to stay above the $80/bbl mark throughout the whole week. Prices increased after Energy Department report showed unexpected drawdown in oil inventories.
As per this week’s inventory report by the Energy Dept, stockpiles fell 1.67 million barrels in the week ended 5 October. At 320.1 million barrels, U.S. crude-oil inventories are still above the upper end of the average range for this time of year. Refinery activity rose to 87.8% from 87.5% the previous week.
The data also showed motor gasoline inventories rose by 1.7 million barrels last week. Distillate fuel supplies (which include heating oil) fell by a larger-than-expected 600,000 barrels.
OPEC has said previously that a falling dollar justified higher prices because oil- producing countries sell crude oil in dollars and often buy goods in euros.
OPEC has planned to boost daily oil production by 500,000 barrels. OPEC's production target is 27.2 million barrels a day, beginning 1 Nov. OPEC, has decided to raise their daily output by 500,000 barrels per day, starting 1 November.