U.S. oil prices extended the
winning streak to the sixth straight day on Wednesday after the
latest report showed energy demand in the United States was growing.
According to the Energy Information Administration, U.S. average
oil demand increased for the third week in a row.
U.S. crude oil inventories fell by 809,000 barrels last week
while gasoline inventories dropped by 1.82 million barrels, contrary
to forecasts.
Traders also kept a close watch on the remarks from Federal
Reserve Chairman Ben Bernanke when he testified before the Congress
for the second day.
Bernanke reiterated that the Fed stood ready to offer more
stimulus as needed but stopped short of signaling action in the near
term.
"At this point we don't see a double dip recession. We see
continued moderate growth," he said, easing some concerns among
investors over the economy.
Echoing his assessment, the central bank's Beige Book released
Wednesday afternoon said overall economic activity "continued to
expand at a modest to moderate pace in June and early July" in the
majority of its 12 districts.
Tensions between Iran and some western countries continued to
bolster oil prices. U.S. Defense Secretary Leon Panetta said the
United States will hold Tehran directly responsible for any attempt
to disrupt shipping in the Gulf region and will be able to defeat
any Iranian attempt to shut down seaborne commerce.
Oil has gained more than 17 percent since the low it touched last
month, largely due to resurfacing worries of disrupted supplies as
Iran warned it could close the Strait of Hormuz, a strategic
waterway.
When the market closed, light, sweet crude for August delivery
rose 0.65 dollars, or 0.73 percent, to settle at 89.87 dollars a
barrel on the New York Mercantile Exchange.
In London, Brent crude for September delivery gained 1.16
dollars, or 1.12 percent to settle at 105.16 dollars a barrel.
