Oil price nears $110 a barrel amid fall in US inventories

Global oil prices rose amid a fall in the United States crude inventories.

On Thursday, Brent crude futures, the global oil benchmark, increased 1.5 percent to trade at $108.3 a barrel. 

West Texas Intermediate rose 1.98 per cent to $99.19 a barrel.

The United States crude oil stockpiles fell by 4.5 million barrels last week, against expectations of a million-barrel drop, while US petrol demand rebounded by 8.5 percent, data from the Energy Information Administration showed.

“The U.S. consolidated its position as the world’s largest petroleum exporter,” Citi analysts told Reuters in a note.

The analysts said combined gross exports of crude oil and refined products at a record 10.9 million barrels per day.

Tina Teng, CMC Markets analyst, said: “Risk sentiment has recovered from recession fears due to the ongoing US earnings optimism and less aggressive Fed rhetoric on rate hikes, which supported a rally in the crude market.”

She added that a weakened dollar has also lifted commodities prices.

Nigeria, in the mix, should ordinarily benefit from high oil prices as an oil-exporting country — but several issues, including oil theft, dwindling investments, and divestments, continue to shrink production capacity. 

In the first quarter of the year, the Nigerian Upstream Petroleum Regulatory Commission (NUPRC) said the country lost at least $1 billion due to oil theft.

The country’s oil production declined steadily from January to May, rising in June for the first time in the year.