Updated on
Summary Oil prices rose more than 2 percents on reports of potential steps to boost a slowing U.S. economy.
Hopes that the Federal Reserve will signal potential steps to boost a slowing U.S. economy have helped the price of oil rise more than 2 percent on Wednesday.China also reported strong auto sales for last month, and the U.S. said crude supplies declined last week by a much larger amount than what analysts expected.Benchmark U.S. crude rose by $2.05, or 2.4 percent, to $85.96 per barrel in afternoon trading in New York. Brent crude, which helps set the price of imported oil, increased by $1.96, or 2 percent, to $99.93 per barrel in London.The Fed is expected to release the minutes of a June meeting where it decided to extend a bond-buying program through the end of the year. Independent oil analyst Andrew Lipow said investors are betting the minutes will provide new details about what steps the Fed would take to stimulate the economy if it keeps slowing down.Prices began to rise early in the day after Chinas auto industry said sales jumped 9 percent in June despite a slowing economy. China has quickly become the worlds biggest market for new vehicles, leading some cities to limit new registrations in hopes of controlling traffic congestion. Those limits drove customers to showrooms last month to buy cars ahead of any restrictions.In the U.S., the government said oil supplies fell last week by 4.7 million barrels triple the decline expected by analysts as refineries cranked up production of gasoline and other refined fuels. Average oil demand also increased slightly last week.Meanwhile, the Organization of Petroleum Exporting Countries reported that world supplies fell last month by about 100,000 barrels per day, in part because of a large drop in production in Iran. Iranian oil production has suffered as Europe and the U.S. work to limit its exports and force the country to scale back its nuclear program. Western nations fear Iran is building a weapon; Iran denies the claim.In other futures trading, heating oil added 3 cents to $2.75 per gallon while gasoline futures rose by 1.76 cents to $2.7645 per gallon. Natural gas increased by 6.2 cents to $2.799 per 1,000 cubic feet.
