Oil settles up more than 2% as U.S. inventories fall, demand picks up | Reuters

Oil settles up more than 2% as U.S. inventories fall, demand picks up | Reuters

Oil prices settled more than 2% higher on Monday, buoyed by falling U.S. crude inventories and rising winter fuel demand due to one of the worst snowstorms to hit the U.S. Northeast in years.

Brent crude settled up $1.31 cents, or 2.4%, at $56.35 a barrel. U.S. crude gained $1.35 cents, or 2.6%, to settle at $53.55. Both benchmarks gained nearly 8% in January.

U.S. government data last week showed a drawdown of 2.3 million barrels in stocks at the Cushing, Oklahoma, delivery hub for crude futures. Another 2.3 million-barrel weekly decline is expected, analysts and traders said citing a Wood Mackenzie report.

“Crude is being supported by many small factors this week - expected drawdowns in Cushing, a sudden rise in winter fuel demand amid colder weather, and further talks on Capitol Hill about stimulus checks,” said John Kilduff, partner at Again Capital LLC in New York.

The U.S. Northeast has been hit by a powerful winter snow storm, pummeling a vast swath stretching from Pennsylvania through New England and causing widespread disruption in New York City and other major urban centers in the region.