Oil rose more than $4 a barrel on Wednesday after U.S. government data showed an unexpected drop in gasoline stocks.
"The gasoline data showed a stronger demand than expected and support at $120 held, causing crude futures to rally," said Phil Flynn, analyst at Alaron Trading.
Additional support came from U.S. refinery problems, with BP cutting rates at its Texas City, Texas, plant due to mechanical problems. Top U.S. refiner Valero plans to cut gasoline production by an average of 330,000 barrels per day (bpd) in the third quarter at its 16 plants.
In the past the Dow and broader stock market has moved in the opposite direction of crude prices. As oil went up stocks went down. But that didn’t happen on Wednesday.
“The thinking is the downside in oil is limited,” explains Joe Terranova on CNBC’s Closing Bell. “I think we’re marking time.”