Oil prices spiked as industry data revealed an unexpected decrease in the US crude stockpiles last week and reduced the daily number of Covid-19 cases in the world’s second-biggest oil importer China.

Brent crude futures increased by $0.19, or 0.3%, to reach $56.10 a barrel, while US West Texas Intermediate (WTI) crude futures increased by $0.20, or 0.4%, to reach $52.81 a barrel, reported Reuters.

Vanda Insights oil market analyst Vandana Hari was cited by the news agency as saying: “WTI is slightly firmer on the back of a larger-than-expected draw in US crude inventories reported by the API, which is offset by builds in gasoline and distillates.”

According to the American Petroleum Institute (API) report, US crude oil inventories dropped by 5.3 million barrels in the week ending 22 January compared with analysts’ estimation for a build of 430,000 barrels in a Reuters poll.

However, data showed an increase in gasoline stocks by 3.1 million barrels, which was more than estimated.

Moreover, API data revealed distillate fuel inventories, including diesel and heating oil, spiked by 1.4 million barrels, compared to the estimated draw of 361,000 barrels while refinery runs dropped by 76,000 barrels per day.

Reuters cited ING economics as saying: “Market participants are now in ‘wait and see’ mode, wanting to see how lockdowns evolve in the coming weeks and months, and how successful countries are in rolling out Covid-19 vaccines.”