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Crude gains as U.S. stockpiles take surprising drop

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Shutterstock photo - Crude oil futures rose in U.S. trading on Wednesday after official data revealed U.S. crude inventories took an unexpected drop last week.

Talk of bottlenecks in North Sea oilfields pushed up prices as well.

On the New York Mercantile Exchange, light, sweet crude futures for delivery in March traded at USD94.50 a barrel on Wednesday, up 0.83%, off from a session high of USD94.78 and up from an earlier session low of USD93.56.

The U.S. Energy Information Administration said in its weekly report earlier that U.S. crude oil inventories fell by 951,000 barrels in the week ended Jan. 11, confounding expectations for an increase of 2.27 million barrels.

Total U.S. crude oil inventories stood at 360.3 million barrels as of last week.

The government report also showed that total motor gasoline inventories increased by 1.9 million barrels, below expectations for a gain of 2.93 million barrels.

The news sent prices gaining as did reports of pipeline closures in the North Sea.

Meanwhile, the World Bank earlier cut its 2013 global growth forecast to 2.4% from a 3% forecast made in June, adding developing nations will struggle this year, which dampened oil's gains.

The multilateral lending institution added that the eurozone economy will contract by 0.1% this year, well below its most recent forecast for growth of 0.7%.

Earlier, Germany's government said that the economy will grow just 0.4% in 2013, down from its previous forecast for 1% growth.

Fears that political differences will hamper talks to lift the U.S. government's USD16.4 trillion debt ceiling, likely sometime by late February, kept prices at bay as well.

Democrats and Republicans have differed over how much spending should be cut in exchange for congressional approval to raise the government's debt ceiling and avoid default.

In 2011, when the country last approached its government borrowing limit, lawmakers waited until the very end to move, nearly throwing the country into default and prompting the Standard & Poor's credit ratings agency to strip the country of its triple-A rating.

Elsewhere on the ICE Futures Exchange, Brent oil futures for March delivery were down 0.02% at USD109.66 a barrel, up USD15.16 from its U.S. counterpart. - offers an extensive set of professional tools for the Forex, Commodities, Futures and the Stock Market including real-time data streaming, a comprehensive economic calendar, as well as financial news and technical & fundamental analysis by in-house experts.

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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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