US oil settles 2.4% higher at $58.26 a barrel on declining crude stockpiles

Oil pumpjacks in the Permian Basin oil field are getting to work as crude oil prices gain.
Spencer Platt | Getty Images

Oil prices rose on Wednesday, buoyed by a large U.S. inventories drawdown and as sanctions stall exports from Venezuela.

International Brent crude oil futures were at $67.63 a barrel, up 98 cents, or 1.47 percent, from their last close. U.S. West Texas Intermediate crude futures were at $58.37 per barrel, up $1.50, or 2.64 percent — building on their strong gains from earlier in the day.

The Energy Information Administration said Wednesday that U.S. crude inventories fell by 3.9 million barrels last week. The data came after the American Petroleum Institute also said Tuesday that U.S. crude stocks had fallen in the previous week.

Oil prices have been pushed up this year by supply cuts led by the Middle East-dominated Organization of the Petroleum Exporting Countries.

Saudi Energy Minister Khalid al-Falih said on Sunday that the production-curbing agreement would likely last until at least June. Saudi Arabia, the world's top oil exporter, indicated on Monday that it would cut April exports.

Markets have been further tightened by U.S. sanctions against oil exports from OPEC members Iran and Venezuela.

Venezuela's worst blackout on record has left most of the country without power for six days, with hospitals struggling to keep equipment running, food rotting in the tropical heat and exports from the country's main oil terminal stranded.

"Failures in the electrical system ... (are) likely to accelerate the loss of 700,000 barrels per day" in oil supply, Barclays bank said.

National Australia Bank reported a mixed outlook for oil, with global economic concerns and strong oil supply growth from the United States keeping prices in check but OPEC supply cuts and U.S. sanctions on Iran and Venezuela driving them up.