Oil prices rise on expectation of U.S. SPR refilling

NEW YORK, May 9 (Xinhua) -- Crude oil futures prices reversed losses in early session and gained on Tuesday as reports said the United States planned to purchase oil so as to replenish its Strategic Petroleum Reserve (SPR).

The West Texas Intermediate for June delivery increased by 0.55 U.S. dollars, or 0.75 percent, to settle at 73.71 dollars a barrel on the New York Mercantile Exchange. Brent crude for July delivery added 0.43 dollars, or 0.56 percent, to settle at 77.44 dollars a barrel on the London ICE Futures Exchange.

According to a report by Bloomberg Tuesday afternoon, the Biden administration plans to begin purchasing crude oil to fill strategic crude oil reserves after completing maintenance later this year.

Oil prices witnessed a real turnaround on the above-mentioned report, noted Phil Flynn, senior analyst at The Price Futures Group.

U.S. inventories of crude oil, gasoline and distillate fell by 1.8 million barrels, 550,000 barrels and 1.1 million barrels in the week ending May 5, according to a survey of analysts by S&P Global Commodity Insights.

The start of summer season in the Northern Hemisphere and voluntary production cuts by members of the Organization of the Petroleum Exporting Countries (OPEC) are expected to bolster oil prices.

"Although demand growth for liquid fuels faces downside risks through the end of 2024, we expect the seasonal rise in oil consumption and a drop in OPEC crude oil production to put some upward pressure on crude oil prices in the coming months," said the U.S. Energy Information Administration Tuesday in a short-term energy outlook report for May.