Oil Advances as U.S. Output Falls Amid Slowing Stockpile Growth

Oil gained for a second day after climbing the most in more than three weeks as U.S. crude output fell and stockpiles increased less than forecast.

Futures advanced as much as 2.4 percent in New York after rising 5.8 percent Wednesday, the most since Feb. 22. Production slid to the lowest level since November 2014 and inventories expanded by 1.3 million barrels, the smallest reported gain in five weeks, according to government data. Supplies were projected to increase by 3.2 million barrels. Oil producers from OPEC and outside the group are finalizing a plan to discuss freezing output at a meeting in Qatar on April 17.

“U.S. output is inching in the right direction,” Ric Spooner, a chief analyst at CMC Markets in Sydney, said by phone. “Oil has climbed from its lows, but we are starting to get into territory where the price is going to need fundamentals to catch up to push it further. The freeze probably has limited impact if it doesn’t include Iran and Iran has indicated it’s unlikely to be part of a deal.”

Oil has rebounded this year after slumping to the lowest in more than 12 years on speculation a global surplus will ease amid stronger demand and falling U.S. output. Prices also surged Wednesday after the the Bloomberg Dollar Index, which tracks the currency against major peers, fell 1.1 percent following a decision by the Federal Reserve to keep borrowing costs steady while scaling back forecasts of how high rates will go this year.

West Texas Intermediate for April delivery climbed as much as 92 cents to $39.38 a barrel on the New York Mercantile Exchange Exchange An exchange is known as a marketplace that supports the trading of derivatives, commodities, securities, and other financial instruments.Generally, an exchange is accessible through a digital platform or sometimes at a tangible address where investors organize to perform trading. Among the chief responsibilities of an exchange would be to uphold honest and fair-trading practices. These are instrumental in making sure that the distribution of supported security rates on that exchange are effectiv An exchange is known as a marketplace that supports the trading of derivatives, commodities, securities, and other financial instruments.Generally, an exchange is accessible through a digital platform or sometimes at a tangible address where investors organize to perform trading. Among the chief responsibilities of an exchange would be to uphold honest and fair-trading practices. These are instrumental in making sure that the distribution of supported security rates on that exchange are effectiv Read this Term and was at $39.21 at 8:49 a.m. Hong Kong time. The contract advanced $2.12 to $38.46 on Wednesday. Total volume traded was about 86 percent above the 100-day average.

Brent for May Settlement Settlement Settlement in finance refers to the process when a buyer makes payment and receives the agreed-upon services or goods. The term is used on exchanges such as New York Stock Exchange (NYSE) when security changes hands. When the asset is transferred and placed in the new buyer's name, it is considered settled. This process could take a few hours or several days after a trade is made. It depends on the clearance process. In the United States, the settlement date for marketable stocks is usually 2 Settlement in finance refers to the process when a buyer makes payment and receives the agreed-upon services or goods. The term is used on exchanges such as New York Stock Exchange (NYSE) when security changes hands. When the asset is transferred and placed in the new buyer's name, it is considered settled. This process could take a few hours or several days after a trade is made. It depends on the clearance process. In the United States, the settlement date for marketable stocks is usually 2 Read this Term rose as much as 66 cents, or 1.6 percent, to $40.99 a barrel on the London-based ICE Futures Europe exchange. The contract gained $1.59 to $40.33 on Wednesday. The global benchmark crude was at a 15-cent premium to WTI for May.

--With assistance from James Paton To contact the reporter on this story: Ben Sharples in Hong Kong at bsharples@bloomberg.net. To contact the editors responsible for this story: Ramsey Al-Rikabi at ralrikabi@bloomberg.net, Aaron Clark, Ovais Subhani

By: Ben Sharples

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