Oil closed above $41 a barrel in New York after terrorist attacks in Brussels airport departure hall and a subway station, despite forecasts that U.S. crude inventories climbed.
U.S. crude stockpiles are forecast to have risen last week, keeping supplies at the most since 1930. Oil gained Monday after OPEC Secretary General Abdalla El-Badrisaid that 15 or 16 nations will attend oil- output freeze talks on April 17.
“The oil market initially reacted to the Brussels attacks,” said John Kilduff, a partner at Again Capital LLC, a New York- based hedge fund that focuses on energy. “The drop was short- lived. The market has a lot of support.”
Oil slumped to a 12-year low in February before rising on speculation that stronger demand and falling U.S. output will ease a global surplus. The drop in production outside the Organization of Petroleum Exporting Countries, along with a decline in U.S. drilling, show that the group’s strategy of letting the market rebalance itself is working, El-Badri said in Vienna Monday.
West Texas Intermediate for May delivery settled at $41.45 a barrel on the New York Mercantile Exchange. Brent for May settlement hit $41.79 on the London-based ICE Futures Europe exchange.
U.S. crude supplies probably climbed 2.53 million barrels last week, according to the median of responses in a Bloomberg survey of analysts before the release of Energy Information Administration data on Wednesday. Stockpiles at Cushing, Oklahoma, the nation’s biggest oil-storage hub and the delivery point for WTI futures, are forecast to have climbed 335,000 barrels.
Gasoline inventories probably dropped 2.2 million barrels last week, the survey showed. Consumption of the motor fuel was 9.39 million barrels a day in the four weeks ended March 11, the highest seasonal level in at least a decade, according to EIA data.
“Crude has been getting strength from strong gasoline demand,” Kilduff said. “Expectations are that tomorrow’s data will show another gasoline stock draw and strong demand.”
Saudi Arabia will join the meeting of producers from within and outside OPEC in Doha, Qatar, next month, adding weight to the campaign by financially stricken crude exporters to freeze output and overcome the glut that’s weighing on the market.
Nigeria will attend while Libya will skip the meeting, according to a people familiar with the matter. Brazil and Argentina also don’t plan to send delegations.
But Eni SpA, Italy’s largest energy producer, sees “some recovery” in the global oil market as demand increases and supply declines, and Vitol Group, the world’s largest independent oil trader, said it handled a record volume of 6 million barrels a day of crude and refined products last year.