Oil cuts losses after larger-than-expected crude draw

(Bloomberg) — Losses were contained after a US government report showed oil inventories fell more than unexpectedly just before Hurricane Ida slammed into Louisiana over the weekend.

Futures fell 1.2% in New York on Wednesday. Domestic crude oil inventories fell 7.17 million barrels last week and gasoline inventories rose 1.29 million barrels, according to data from the Energy Information Administration. The industry-funded American Petroleum Institute had reported a drop in crude oil supply by more than 4 million barrels. Among fuels, the group reported an increase in gasoline inventories and a decrease in diesel inventories.

Also, the OPEC+ alliance will meet shortly after this EIA report to discuss the next steps in manufacturing recovery. The group is likely to stamp its 400,000 barrels per day production increase plan or take steps to respond to the slump in demand following the spread of the Delta variant.

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