In a report delivered late on Tuesday by the American Petroleum Institute, US crude stockpiles dropped by 531,000 barrels last week, forcing oil bears to cover their shorts while sending prices higher. The API figure compared with the average analysts’ estimate of an increase of 3.700 million barrels for the period.
If the drawdown is confirmed by official US government data due later Wednesday, it would mark the first weekly drawdown after nine straight build-ups. Earlier on Tuesday, oil tumbled after OPEC reported a surge in global crude stocks amidst a surprise output jump in Saudi Arabia. OPEC's monthly report showed that oil stocks in industrialized countries rose to 278 million barrels in January, above the five-year average. Brent futures were last seen at $51.60 after ending last session down at $50.90 per barrel.