Oil prices rose about 2 percent on Wednesday, hitting their highest since June, after the fifth unexpected weekly drawdown in US crude inventories.
Speculation about the Organization of the Petroleum Exporting Countries’ plan to cut production at its meeting next month also kept the market supported.
Brent crude was up $1.06, or 2.1 percent, at $51.92 a barrel by 1614 GMT, peaking at $52.09, its highest since June 10.
US West Texas Intermediate (WTI) crude was up $1.11, or 2.3 percent, at $49.80. It earlier hit $49.95, a high since June 29.
The US Energy Information Administration (EIA) said crude stockpiles fell 3 million barrels last week, opposite of forecasts of analysts polled by Reuters for a build of 2.6 million barrels.
A total draw of 26 million barrels since beginning of September has surprised many market participants, as it came toward the end of summer and has carried into autumn, when driving drops and US refineries shut for seasonal maintenance.
US refinery utilization rates have dropped over the past four weeks, dropping by nearly 2 percentage points last week to 88.3 percent of nationwide capacity, EIA data showed, normal for early autumn. It was at around 93 percent two weeks ago.
“The inability of inventories to rebound given the steep drop in refining utilization over the past two weeks is especially bullish,” said John Kilduff, partner at New York energy hedge fund Again Capital.
But some analysts said profit-taking could set soon in crude futures with Brent’s Relative Strength Index at 69 and WTI’s at 63, both edging toward the overbought level of 70.
“Positive news has already been baked in the cake, and prices could ease lower from here, especially given the rampant rally of recent days,” said Matt Smith of New York-based Clipperdata, which analyzes data and impact from crude cargoes and supplies.
Oil prices have rallied around 13 percent over the past six sessions after OPEC announced plans to limit output, its first in eight years, when it gathers for its policy meeting in Vienna in November.
OPEC’s target is to target production to 32.5 million-33 million barrels per day by cutting some 700,000 bpd from a glut of about 1.0 million-1.5 million bpd estimated by analysts. The group has invited Russia and other major producers to join in making cuts.
Many analysts are skeptical of OPEC’s target as the biggest crude producers in the group have been pumping or exporting as much as they could while talking of cuts.
Prices have continued to rise though. 
Consultancy group PIRA says it believes Saudi Arabia is trying to move prices to $60 a barrel from $50. 
OPEC’s decision to embrace production cuts will help move crude prices toward a target of $50 to $60 per barrel, said Gary Ross, chairman of consultancy PIRA Energy Group.
OPEC’s policy has shifted as Saudi Arabia is targeting that price range and Iran has become more willing to accept an agreement.
Ross said at a news conference that US shale producers were likely to hedge future output more selectively after OPEC decided to limit output.
Shale producers and oil-consuming companies were under-hedged, he said, adding that industrial and airline buying would support prices.
The surplus in oil supply has been eroding since the second quarter and will be “gone” by the second half of 2017, Ross said.

Source: Arab News