Oil prices jumped on Wednesday as plunging U.S. crude stockpiles compounded supply concerns due to uncertainty over Libyan exports, a production disruption in Canada, and U.S. demands that importers stop buying Iranian crude from November. U.S. crude stocks fell by nearly 10 million barrels last week, the most since Sept. 2016, while gasoline and distillate inventories rose less than expected, the Energy Information Administration said.
Crude stocks at the Cushing, Oklahoma, delivery hub for the NYMEX futures contract fell by 2.7 million barrels, EIA said. “Cushing is a whopper,” said Bob Yawger, director of energy futures at Mizuho, referring to the drawdown.
The report reflects only one single day of a Syncrude production disruption in Canada, where output feeds into pipelines that go to Cushing. Production at Syncrude’s oil sands facility was offline at least through July, after a power outage last week locked in 350,000 bpd.
“Next week, you’re going to have a Cushing storage number that includes seven days of the Syncude outage.—Reuters