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Crude prices soar as U.S. supplies hit 17-month lows

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Investing.com - Crude oil futures soared on Wednesday after official U.S. data revealed inventories hit lows not seen since March of 2012.

On the New York Mercantile Exchange, light sweet crude futures for delivery in November traded at USD106.46 a barrel during U.S. trading, up 1.56%.

The November contract settled down 1.29% at USD104.82 a barrel on Tuesday.

The commodity hit a session low of USD104.56 and a high of USD106.80.

The Energy Information Administration reported earlier that U.S. crude oil stockpiles dropped by 4.37 million barrels in the week ending Sept. 13, well beyond expectations for a decline of 1.39 million barrels and far past a decline of 219,000 barrels in the previous week.

The numbers sent prices surging especially after several sessions of declines fueled by the ebbing possibility of a U.S. military attack on Syria.

Investors kept a close eye on the Federal Reserve, which was due to announce its decision on interest rates and monetary policy later Wednesday.

Expectations were high for the Fed to trim its USD85 billion monthly bond-buying program by anywhere from USD10-20 billion.

Monetary stimulus tools such as Federal Reserve asset purchases weaken the greenback by driving down interest rates, making oil an attractive asset in dollar-denominated exchanges.

Oil remained higher on sentiments the Fed will merely begin to wind down its bond-buying program but won't end it, which should continue to support prices for the foreseeable future.

Meanwhile on the ICE Futures Exchange, Brent oil futures for November delivery were up 1.15% at USD109.44 a barrel, up USD2.98 from its U.S. counterpart.

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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.


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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