Investing.com - Oil prices extended gains in North American hours on Thursday, rising to the strongest levels of the session after data showed that crude supplies in the U.S. fell by the most since April 1985.
Crude oil for October delivery on the New York Mercantile Exchange was up $1.41, or 3.1%, at $47.02 a barrel by 11:04AM ET (15:04GMT). Prices were at around $46.18 prior to the release of the inventory data.
The U.S. Energy Information Administration said in its weekly report that crude oil inventories fell by 14.51 million barrels in the week ended September 2. Market analysts' expected a crude-stock gain of 225,000 barrels, while the American Petroleum Institute late Tuesday reported a supply drop of 12.1 million barrels.
Supplies at Cushing, Oklahoma, the key delivery point for Nymex crude, decreased by 434,000 barrels last week, the EIA said.
Total U.S. crude oil inventories stood at 511.4 million barrels as of last week, which the EIA considered to be “historically high levels for this time of year”.
The report also showed that gasoline inventories declined by 4.211 million barrels, compared to expectations for a 171,000-barrel drop.
For distillate inventories including diesel, the EIA reported an increase of 3.382 million barrels.
The EIA data came out one day later than usual due to Monday's Labor Day holiday.
Elsewhere, on the ICE Futures Exchange in London, Brent oil for November delivery tacked on $1.42, or 2.94%, to trade at $49.40 a barrel.
Oil traders continued to weigh prospects that major oil producing nations will freeze output to support the market when they meet later this month.
The Organization of the Petroleum Exporting Countries, led by Saudi Arabia and other big Middle East crude exporters, will meet non-OPEC producers led by Russia at informal talks in Algeria between September 26 and 28.
Brent spiked sharply on Monday after Saudi Arabia and Russia pledged to work together to support the market. But prices have since fallen back as the agreement stopped short of delivering imminent action to tackle a supply glut.
Chances that the upcoming meeting would yield any action to reduce the global glut appeared minimal, according to market experts. Instead, most believe that oil producers will continue to monitor the market and possibly postpone freeze talks to the official OPEC meeting in Vienna on November 30.
An attempt to jointly freeze production levels earlier this year failed after Saudi Arabia backed out over Iran's refusal to take part of the initiative, underscoring the difficulty for political rivals to forge consensus.