(Corrects location of ICAP (LON:IAP) specialist to North Carolina in
paragraph 9)
* API reports 1.1 mln bbls U.S. crude draw vs expected build
* Gasoline hits Aug highs on refinery outages, boosting
crude
* Dollar slump adds to gains in oil
* Coming up: U.S. govt report on crude inventories on
Wednesday
By Barani Krishnan
NEW YORK, April 26 (Reuters) - Crude oil prices hit 2016
highs on Tuesday on the back of a rally in the gasoline market
and after an industry group reported a surprise draw in U.S.
crude stockpiles.
Brent and U.S. crude's West Texas Intermediate (WTI) futures
finished regular trading about 3 percent higher, riding on the
coattails of a gasoline rally that hit August highs after a
series of refinery hikes.
In post-settlement trade, both benchmarks rose more than 4
percent after the American Petroleum Institute reported a
drawdown of nearly 1.1 million barrels in U.S. crude inventories
last week versus a 2.4 million-barrel build expected by analysts
in a Reuters poll. API/S EIA/S
The API report is a precursor to official inventory data due
on Wednesday from the U.S. Energy Information Administration.
"There's a possibility we could see newer highs from here,
notwithstanding the EIA data, as the market is really fired up
on the idea of tightening supplies," said John Kilduff, partner
at New York energy hedge fund Again Capital.
Brent crude futures LCOc1 finished up $1.26 at $45.74 a
barrel. In post-settlement trade, it rose as much as $2.01 to a
2016 high of $46.49.
U.S. crude futures CLc1 settled up $1.40 at $44.04. It
gained $2.19 in after-hours trade to reach a year-to-date peak
of $44.83.
Crude markets got off to a rousing start in the New York
session as gasoline futures and gasoline refinery margins both
surged from refinery outages, Venezuela buying and a reported
drop in New York inventories.
"I think the market has become more optimistic on oil
products," said Scott Shelton, broker and commodities specialist
with ICAP in Durham, North Carolina. "If refining margins stay
strong, crude runs will be quite high and that will make the
odds of a crude stock draws increase significantly."
Oil prices are headed for a fourth straight week of gains,
with Brent on track to finish April 17 percent higher for its
best monthly gain in a year, despite aborted plans by major
producers to agree on an output freeze at a meeting in Qatar
earlier this month.
Tuesday's oil rally was also underpinned by a weaker dollar,
which fell on expectations that the U.S. Federal Reserve's
Federal Open Market Committee (FOMC) will keep interest rates at
existing levels. The dollar rallied earlier this year, weighing
on oil, as investors braced for higher rates. FRX/
"For now, the line of least price resistance remains to the
upside, and we will be reassessing this view in light of
tomorrow's FOMC statement," said Jim Ritterbusch of
Chicago-based oil market consultancy Ritterbusch & Associates.
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CHART-Singapore light distillate stocks http://tmsnrt.rs/1Vp4EpW
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