Oil futures rise one percent despite US inventory buildup

Oil futures rose one percent away from ten-month lows for the sixth session in a row, as the dollar index plumbed the lowest since early October, following earlier data from the US, the world's largest energy consumer. 

As of 06:45 GMT, US crude futures due on August 16 rose 1.01% to $44.69 a barrel from the opening of $44.24, while Brent crude futures due on August 16 jumped 1.22% to $47.22 a barrel from the opening of $46.65, as the dollar index declined 0.27% to 96.13 from the opening of 97.39, marking nine-month lows. 

Earlier US data showed the goods trade deficit shrinking more than expected, while wholesale inventories rose past expectations in May, as pending home sales fell unexpectedly last month. 

Federal Reserve Governor Janet Yellen ruled out another financial crisis at least in her life, due to the baking reforms made after the 2007-2008 banking collapse, while saying it would be good if reforms made since the last crisis carried on. 

Yellen urged those who helped overcome the crisis back then to work hard to prevent any loosening of these reforms, while asserting the Federal Reserve will continue tightening its monetary policy gradually, and trim down its holdings of treasury bonds and mortgage-backed securities collected after the last crisis to underpin the economy. 

Similarly, the Energy Information Administration released its report on US crude stocks, showing a buildup of 0.1 million barrels in the week ending June 23, compared to a 2.5M drawdown in the previous reading, while analysts expected a rise of 2.1M, with total stocks now reaching 509.2 million barrels, remaining within the uppermost range in average for this time of year. 

Otherwise, gasoline stocks fell 0.9 million barrels, while distillate inventories, including heat fuel, fell 0.2 million barrels, both remaining within the uppermost range in average for this time of year. 

Oil futures are recovering on short-covering as the dollar tumbles noticeably this week, and after crude prices marked the fifth weekly loss in a row last Friday, the longest such streak since 2015,  as markets priced in above five-year averages global oil inventories at 292 million barrels, and after US, Libyan, and OPEC production increased in May.