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May 28, 2015

Crude oil prices rise due to dip in US inventories

Crude oil prices on Friday increased around 1% following a decline in the US inventories for a fourth straight week.

Crude oil prices on Friday increased around 1% following a decline in the US inventories for a fourth straight week.

July Brent rose 60 cents reaching $63.18 a barrel, while the US crude, also called West Texas Intermediate (WTI) increased by 70 cents to end at $58.38, Reuters reported.

Prices were also supported by US crude inventory data in addition to raging wildfires in Canada, which hit 10% of its oil sands output.

"Prices were also supported by US crude inventory data in addition to raging wildfires in Canada, which hit 10% of its oil sands output."

The US Energy Information Administration (EIA) data highlighted a fall in crude oil inventories by 2.8 million barrels last week, which was more than the 857,000 barrel drawdown forecast shown in a survey by the news agency.

According to latest data, commercial crude inventories in the country dropped 2.8 million barrels to 479.4 million during the week ending 22 May, while petrol inventories fell 3.3 million barrels.

EIA data also showed that the crude production in the country rose by 304,000 barrels per day to 9.57 million barrels.

The Organization of the Petroleum Exporting Countries (OPEC) is planning a meeting on 5 June, which may not impact the policy change of maintaining production level.

Market analysts believe that the OPC countries will continue to produce 30 million barrels of oil per day.

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