Oil prices rose more than 2% on Wednesday, boosted by a huge drop in US fuel inventories and expectations that OPEC+ producers might decide against increasing output when they meet this week.

US gasoline stocks fell last week by the most on record and refining output fell to a record low in the wake of a deep freeze in Texas that shut production.

Gasoline inventories fell to 243.5 million barrels, the US Energy Information Administration said, while distillate stockpiles fell by the most since 2003 to 143 million barrels.

“This drop is 100% based upon the storm in Texas,” said John Kilduff, partner at Again Capital Markets in New York. “It froze up the entire Texas supply chain and caused a drawdown on available refined product stores.”

Brent crude rose $1.30, or 2.1%, to $64 a barrel, a 2.1% gain by 1611 GMT. US West Texas Intermediate (WTI) crude rose $1.55, or 2.6%, to $61.30 a barrel.

Oil prices earlier jumped after Reuters, citing three sources, reported that the OPEC+ group is considering rolling over production cuts from March into April rather than raising output.

Published in The Express Tribune, March 4th, 2021.

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