Brent crude oil futures rose on Wednesday as traders took profit on an over-extended spread trade with U.S. oil, which itself was supported by record heating oil demand due to continued freezing weather.
Stockpiles of distillates, that include heating oil, fell 2.4 million barrels, nearly double what analysts expected, according to the data from the U.S. Energy Information Administration.
In the heavily populated U.S. East Coast, which has been repeatedly hit with snow, stocks dropped to their lowest levels since April 2003.
March Brent crude touched an intraday high of $106.29 but drifted lower to above $106 a barrel, up 50 cents after three straight sessions of losses. U.S. crude for March delivery rose for a second session, losing most of an earlier bounce but settling up 19 cents at $97.38.
Earlier, data showed U.S. private payrolls generated fewer jobs than Wall Street expected last month, setting the stage for Friday's nonfarm payrolls data.
The data also showed that crude stocks at Cushing, Oklahoma, from where the southern leg of TransCanada Corp's Keystone pipeline has moved oil to the Gulf Coast since January, fell by 1.6 million barrels, as expected.
Crude oil stocks rose by 440,000 barrels, far below the forecast of a 2.3 million barrel build.
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