Oil prices steadied on Wednesday after U.S. government data showed a drop in crude oil inventories, and oil demand is expected to increase next year as a result of progress in the settlement of the Sino-U.S. trade dispute.
Brent crude rose $0.07 to close at $66.17 a barrel. US crude oil futures closed down $0.01 at $60.93 a barrel.
US crude oil inventories fell 1.1 million barrels to 446.8 million barrels in the week ended December 13, according to the EIA, with the market predicting a 1.3 million barrel decline.
According to EIA data, US gasoline inventories increased 2.5 million barrels last week to 233.3 million barrels, the highest since March; distillate inventories increased 1.5 million barrels to 125.1 million barrels.
Oil prices recovered after the data was released. The EIA data is at odds with Tuesday's data from the American Petroleum Institute (API). US crude inventories rose 4.7 million barrels to 452 million last week, according to API data, triggering a sell-off in oil futures after settlement time.
"The market's response has suddenly increased because it is far from the net increase in inventory as predicted by the industry," said Tony Headrick, energy market analyst at CHS hedging.
"With these data supports and optimistic demand expectations brought by recent developments such as the US China trade agreement, the upward trend of oil prices is expected to remain unchanged," Headrick said.
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