Crude oil prices moved higher on Wednesday despite data showing a larger than expected increase in U.S. crude stockpiles in the week ended January 31.
Reports in media that some breakthroughs have been made in the developments of treatments for the coronavirus, and expectations that the stimulus announced by China will help revive growth and fuel energy demand contributed to oil’s rise.
Reports suggesting the OPEC and its producer allies are considering further output cuts played a role as well in pushing up crude oil prices.
West Texas Intermediate Crude oil futures for March ended up $1.14, or about 2.3%, at $50.75 a barrel.
On Tuesday, WTI crude oil futures for March ended down $0.50, or 1%, at $49.61 a barrel, the lowest close since January 2019.
According to the data released by the Energy Information Administration (EIA) Wednesday morning, crude inventories rose by 3.4 million barrels last week, after increasing by 3.5 million barrels a week earlier.
Gasoline inventories were down 0.1 million barrels last week, after rising 1.2 million barrels a week earlier. Meanwhile, distillate stockpiles were down 1.5 million barrels last week, higher than a drop of 1.3 million barrels in the week ended January 24.
Data from the American Petroleum Institute showed on Tuesday that U.S. crude oil stocks rose by 4.18 million barrels for the week ending January 31, well above analyst expectations for a 2.8 million-barrel build in inventory.
A Reuters report, citing a Chinese TV source, said a research team at Zhejiang University has found an effective drug to treat people with the new virus.
Sky News also reported that a leading British scientist has made a significant breakthrough in the race for a coronavirus vaccine by reducing a part of the normal development time from “two to three years to just fourteen days.”
However, the World Health Organization said there are “no known” treatments against the virus.
“There are no known effective therapeutics against this 2019-nCoV and WHO recommends enrollment into a randomized controlled trial to test efficacy and safety,” the WHO said in a statement.
The agency added, “A master global clinical trial protocol for research and prioritization of therapeutics is ongoing at the WHO.”