Crude oil rose for a fifth day after U.S. supplies dropped and the country’s economy grew more than previously estimated in the third quarter. Futures climbed as much as 0.3 percent after the Energy Department yesterday said stockpiles in the world’s biggest oil consumer fell to the lowest in 10 months. U.S. gross domestic product expanded 2.6 percent in the third quarter, up from a previous estimate of 2.5 percent, the Commerce Department said. “We are bullish on oil in the short, medium and long term,” Michael Haigh, global head of commodities research at Standard Chartered Plc in Singapore said in an interview on Bloomberg Television. “Over the next year we’re seeing oil creeping up into the mid-$90s.” Crude oil for February delivery rose as much as 31 cents to $90.79 a barrel on the New York Mercantile Exchange, and was at $90.63 at 1:04 p.m. Singapore time. Yesterday, prices advanced 66 cents, or 0.7 percent, to $90.48, the highest settlement since Oct. 3, 2008. Prices have climbed 14 percent this year. Oil volume on the Nymex was 350,573 contracts yesterday, the lowest since Nov. 26, the day after Thanksgiving. More than 1 million contracts were traded on Dec. 7. “A word of caution that when volumes traded are thin, price changes tend to be magnified,” said Serene Lim, a Singapore-based commodity strategist at Australia & New Zealand Banking Group. Commodity Demand Urbanization and population growth in emerging economies like China and India will spur demand for commodities in the next 20 years, according to Haigh. Global oil consumption is forecast to rise to 112 million barrels a day by 2030 from around 89 million currently, he said. “Population and income growth is going to affect the demand side,” he said. “The question is where supply will come from. The marginal barrel is going to come from more expensive areas, so that explains why we get the increase in prices.” U.S. crude stockpiles fell 5.33 million barrels to 340.7 million last week, the Energy Department said. That’s the lowest since Feb. 19. A decline of 3.4 million barrels was forecast, according to the median of 14 responses in a Bloomberg News survey. Inventories along the Gulf Coast, which holds almost half of U.S. refinery capacity, dropped 6.08 million barrels to 167.3 million. Cushing Supplies Suppplies at Cushing, Oklahoma, the delivery point for New York futures, increased 479,000 barrels to 36.4 million, the highest level since August. Stockpiles of distillate fuel, a category that includes heating oil and diesel, dropped 589,000 barrels to 160.7 million, the first decline in three weeks. Analysts were split over whether inventories would rise or fall. Brent crude oil for February settlement gained as much as 26 cents, or 0.3 percent, to $93.91 a barrel on the London-based ICE Futures Europe exchange. Yesterday, the contract advanced 45 cents, or 0.5 percent, to $93.65 on the London-based ICE Futures Europe exchange. To contact the reporter on this story: Ann Koh in Singapore at akoh15@bloomberg.net To contact the editor responsible for this story: Clyde Russell at crussell7@bloomberg.net

Source