By Claudia Assis and Myra P. Saefong, MarketWatch
SAN FRANCISCO (MarketWatch) — Crude-oil futures climbed Thursday, as a surprise decision by key oil producers to keep production quotas unchanged and a bigger-than-expected drop in U.S. crude inventories fed concerns about tighter supplies, lifting prices past $101 a barrel.
On Wednesday, members of the Organization of the Petroleum Exporting Countries could not reach a consensus on increasing production and kept official output targets unchanged.
Separately, the U.S. Energy Information Administration reported a 4.8 million-barrel decline in crude-oil inventories for the week ended June 3. Analysts polled by Platts had expected a fall of around 1.5 million barrels.
In recent trading, light, sweet crude for July delivery CL1N +1.35% gained 54 cents, or 0.5%, to $101.28 a barrel on the New York Mercantile Exchange. It touched a high of $101.87 earlier.
“We were not surprised by the upward price reaction to the OPEC decision, but do not think that this is a turning point for a sustained push higher,” Edward Meir, senior commodity analyst at MF Global, said in a note to clients.
Oil rallied roughly 2% in the North American session on Wednesday, after OPEC representatives failed to reach agreement on production targets and surprised the market by keeping quotas unchanged. Read more about the OPEC meeting.
OPEC’s official output quota has stood at 24.845 million barrels a day since January 2009.
Meir said he expects the bounce in oil prices to be short-lived.
Demand is slowing anyway, and “OPEC’s hawks may be right in that the market may be somewhat oversupplied for the moment,” he said. Read related story on Arab oil and break-even prices.
Economic data Thursday showed that the number of jobless Americans who sought unemployment benefits rose slightly last week. Read about jobless claims.
July gasoline RB1N +1.21% advanced 2 cents, or 0.7%, to $2.99 a gallon. July heating oil HO1N +0.53% tacked on less than a penny, or 0.2%, to $3.10 a gallon.
July natural gas NG11N -1.14% traded higher in early floor trading, but prices got derailed by an inventories report showing a bigger-than-expected increase in supplies.
The Energy Information Administration reported an increase of 80 billion cubic feet in the week ended June 3. Analysts polled by Platts had expected an increase between 74 and 78 billion cubic feet.
The July contract declined 6 cents, or 1.4%, to $4.77 per million British thermal units.
