August 15, 2012 / 4:37 PM / 7 years ago

Oil hits 3-month high on tight supply, eyes stimulus

NEW YORK (Reuters) - Brent crude oil futures climbed to three-month highs above $115 a barrel on Wednesday as a larger-than-expected drawdown in U.S. crude stockpiles combined with expected lower North Sea oil output to paint a tighter supply picture on both sides of the Atlantic.

A customer uses a petrol nozzle in a gas station in Nice August 8, 2012. REUTERS/Eric Gaillard

Hopes for further stimulus by major central banks to support the weakening global economic growth and fears of supply snags as Middle East tensions fester gave further lift to oil futures.

U.S. crude oil inventories dropped 3.7 million barrels last week, the third straight week of drawdowns, data from the U.S. Energy Information Administration showed. The drawdown was far bigger than the forecast for a 1.7 million barrel decline in a Reuters poll of analysts. <EIA/S>

U.S. gasoline stockpiles fell 2.4 million barrels, greater than the 1.5 million barrel drop predicted. The four-week average demand for refined products in the United States rose to 19.3 million barrels per day, the highest since early September, 2011, the EIA data further showed.

The gasoline data sparked positive comments from analysts.

While the crude stock draw was larger than expected, “more importantly we see the large dip in gasoline stocks ready to push us higher into the second half of the summer,” said Carl Larry, president at Oil Outlooks in New York.

In London, September Brent crude struck a session high of $115.28 a barrel, the highest intraday price for front-month Brent since May 4, after release of the EIA data. By 11:50 a.m. EDT (1550 GMT), it traded at $115.16, gaining $1.13.

U.S. September crude was up 36 cents at $93.79 a barrel, having hit a session high of $93.94, below Monday’s intraday high of $94.14.

Brent crude oil’s premium to U.S. crude was at $21.37, heading for its highest close since October, squeezed by maintenance in North Sea production on which the benchmark’s price is calculated.

GRAPHIC showing a 24-hour analysis on Brent: here

GRAPHIC on OPEC production:

Additional reporting by Robert Gibbons in New York, Manash Goswami and Elizabeth Law in Singapore; Editing by Marguerita Choy

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