Early on Thursday in Asia trade, oil soared following dropping US production, which facilitates risk taking.
Crude futures for April delivery hit $34.84 in New York, a 0.4% rise. May Brent oil futures leapt $0.09 in London, reaching $37.02 a barrel.
On Wednesday, the US Energy Administration posted American crude inventories in the week closing by February 29. Following the news, there was a 10.4 million barrels soar. As a result, total stockpiles hit 518 million barrels.
Financial analysts emphasized the soar in crude stocks was mostly driven by relatively strong imports. Furthermore, refining margins are steady enough and it enables crude prices to stay lower than in mid-2014.
Nevertheless, financial markets recovered from decent growth and reacted to the production decrease, which sagged to daily 9.08 million barrels. Besides this, there was a drawdown in gasoline shares – they slumped by 1.5 million barrels.
There’s a risky situation in the global markets now, though traders hope for the better. They hope someday oil producers will gather enough courage to freeze their output.