Oil Captures 3-Week High on Supply Concerns

The gains made in the prior two days have taken the Brent well above the $50.00 per barrel mark, and lifted the WTI within touching distance of that level as well. Analysts attribute the recent rally to supply disruptions in Libya after the shutdown of pipelines from its biggest oil field.

Also supporting prices was a decline in U.S. gasoline inventories, which points to a tightening market despite record stocks of crude. U.S. gasoline inventories fell 3.7 million barrels in the week ended March 24, easily topping expectations of a 1.9 million barrel decrease, the U.S. Energy Information Administration said Wednesday. Crude stockpiles, however, rose 867,000 barrels to a record 534.0 million barrels. Brent June futures are up in early trade at $52.60, just below the strong resistance at $52.70 per barrel.

The Bank of England’s recent data showed the number of loans approved for home purchases dropping to 68,315 in February, versus 69,114 the previous month and below the median projection of 69,900 according to a Reuters poll. The outlook for consumer spending is critical as Prime Minister Theresa May begins two years of negotiations to take the country out of the European Union.

Consumers have kept up their spending post the shock June “Brexit” referendum, but signs that they are turning more wary have become increasingly visible. GBPUSD was last seen just above 1.24350.