Oil above $50 as US stockpiles extend drop

Bloomberg

Oil held gains above $50 a barrel before US government data forecast to show crude stockpiles extended declines,
trimming a glut.
Futures rose as much as 0.5 percent in New York after climbing 9.6 percent the previous six sessions. Inventories probably fell by 3.3 million barrels last week for a fifth weekly drop, according to a Bloomberg survey before a report from the Energy Information Administration on Wednesday. Stockpiles have lost almost 26 million barrels since the end of June.
Oil has climbed above $50 a barrel for the first time since May amid optimism that output curbs by the Organization of Petroleum Exporting Countries and its allies are rebalancing the market and trimming global inventories. US crude imports from OPEC slid 2.6 percent in May from April and shipments from the group may fall further this month as Saudi Arabia deepens cuts.
“The expected draw in crude” is supporting the market, said Tamas Varga, an analyst at brokerage PVM Oil Associates Ltd. in London. If the decline in inventories is confirmed, “we’re probably going to have steady numbers going into tomorrow.”
West Texas Intermediate for September delivery was at $50.24 a barrel on the New York Mercantile Exchange, up 7 cents, at 11:04 a.m. London time. Total volume traded was about 7.1% above the 100-day average. The contract gained 0.9% to $50.17 on Monday.
Brent for October settlement dropped 2 cents to $52.70 a barrel on the London-based ICE Futures Europe exchange, and traded at a $2.35 premium to WTI for the same month. The September contract expired on Monday after advancing 13 cents to $52.65.
US inventories remain about 90mn barrels above the five-year average, according to EIA.