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Crude oil futures remain higher after U.S. supply data

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Shutterstock photo - Crude oil futures held on to gains during U.S. morning hours on Wednesday, after a U.S. government report showed oil supplies fell unexpectedly last week.

Investors were also looking ahead to the outcome of the Federal Reserve's policy meeting, as well as developments surrounding a bailout deal for Cyprus.

On the New York Mercantile Exchange, light sweet crude futures for delivery in April traded at USD92.98 a barrel during U.S. morning trade, up 0.5% on the day.

New York-traded oil prices rose by as much as 1% earlier in the day to hit a session high of USD93.50 a barrel.

Prices traded at USD92.87 a barrel prior to the release of the supply data.

The U.S. Energy Information Administration said in its weekly report that U.S. crude oil inventories fell by 1.3 million barrels in the week ended March 15, confounding expectations for an increase of 2 million barrels.

Total U.S. crude oil inventories stood at 382.7 million barrels as of last week, well above the upper limit of the average range for this time of year.

The report also showed that total motor gasoline inventories decreased by 1.5 million barrels, compared to expectations for a decline of 2.1 million barrels.

Market players now looked ahead to the outcome of the Federal Reserve's two-day policy meeting later in the day, as investors try to assess the central bank's attitude towards monetary stimulus.

Fed Chairman Ben Bernanke is to give a press conference after the release of the policy statement.

The U.S. is the world's biggest oil consuming country, responsible for almost 22% of global oil demand.

Meanwhile, in Cyprus, the government was holding talks aimed at finding an alternative solution after the parliament rejected a proposed bank deposit tax, a condition of a EUR10 billion international bailout deal.

Cyprus's Finance Minister Michalis Sarris said talks with his Russian counterpart on alternative means of financial support had been "very constructive".

Elsewhere, on the ICE Futures Exchange, Brent oil futures for May delivery added 0.75% to trade at USD108.28 a barrel, with the spread between the Brent and crude contracts standing at USD15.30 a barrel.

London-traded Brent prices fell to a three-month low of USD107.28 a barrel on Tuesday, while the spread between the contracts fell to the lowest level since July.

Brent prices have been under pressure in recent sessions due to an improving production outlook in the North Sea.

At the same time, U.S. oil stockpiles at Cushing, Oklahoma, the delivery point for Nymex oil futures, are declining as new pipelines relieve a supply glut there. - 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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