NEW YORK (DTN) -- New York Mercantile Exchange oil futures reversed higher in midmorning trade Wednesday after Russia reportedly said a deal by leading oil producers to cut output later this month looks more likely, overshadowing a mostly bearish weekly oil supply report by the Energy Information Administration.
"The EIA report was bearish other than the fact that refinery runs are up, but the main news supporting the market is that the Russian energy minister has said he thinks it is more likely they will get a deal done," said Phil Flynn, an analysts at Price Futures Group in Chicago.
At last look, NYMEX December West Texas Intermediate crude oil futures rose 20cts to $46.01 bbl. IntercontinentalExchange January Brent crude futures advanced 12cts to $47.07 bbl.
NYMEX December ULSD futures edged up 0.30cts to $1.4469 gallon while December RBOB futures eased 0.45cts to $1.3305 gallon, falling back after initially turning higher.
Russian Energy Minister Alexander Novak is set to hold talks today and tomorrow with key members of the Organization of Petroleum Exporting Countries in Doha to try to fine-tune a plan to coordinate production cuts at the end of this month when the oil cartel meets in Vienna for its biannual summit.
Novak's comments about increased chances of a deal lifted sentiment and prompted a rally just when doubts were starting to creep in about the prospects of an agreement to curb rising supplies. Those doubts have been created by the dispute between Saudi Arabia, Iran and Iraq over how to share the proposed output cuts.
Meantime, the Energy Information Administration released its weekly oil report a short while ago showing across-the-board builds in crude oil and refined product inventories for the week-ended Nov. 11, with crude and distillates supplies unexpectedly higher while the gasoline stock build was more than projected.
The EIA data showed crude oil stocks soared 5.3 million bbl, gasoline stocks climbed 746,000 bbl and distillate stocks increased 310,000 bbl.
Demand data were encouraging, however. EIA said refinery crude in-take increased 309,000 bpd and gasoline demand rose 146,000 bpd, 3.4% higher year-over-year. Distillates demand eased 99,000 bpd, 5.1% lower year-over-year.
George Orwel can be reached at firstname.lastname@example.org
© Copyright 2016 DTN/The Progressive Farmer. All rights reserved.