(Bloomberg) — Oil edged lower after a four-day gain as a key U.S. pipeline restarted, and traders assessed signs a global glut has been drained.
West Texas Intermediate fell 0.6%, after closing on Wednesday at a two-month high. The Colonial Pipeline — a key source of gasoline and diesel for the East Coast — returned to service after a cyberattack late Friday. That’ll bring relief to millions of motorists after panic-buying emptied some gas stations.
A U.S. government report showed domestic crude inventories fell to the lowest since late February last week, adding to signs of market rebalancing. On Wednesday, the International Energy Agency said the world has now largely worked off the surplus that accumulated when the pandemic routed demand.
Oil has surged this year, joining a broad rally in commodities, as investors wager that the economic recovery from the coronavirus outbreak will spur energy consumption. The roll-out of vaccines in the U.S., Europe and China has allowed governments to pare back social-distancing measures, permitting a return to work and much greater mobility. Still, Covid-19 flare-ups in many parts of Asia, including India, have complicated the global picture.
Against the backdrop of improved worldwide demand, rising prices, and lower stockpiles, the Organization of Petroleum Exporting Countries and its allies have been cautious in easing the deep supply cuts imposed last year. At the same time, U.S. shale producers have eschewed moves to rapidly boost output.
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