Oil had its strongest opening week for any year since 2013 as refiners and exporters whittled away at crude inventories tucked away in U.S. storage tanks. Futures rose 1.7 percent this week in New York. The pull on oil stockpiles in the world’s biggest economy accelerated to 7.42 million barrels last week, a level last seen in early August. U.S. inventories are shrinking at a time when OPEC and allies producers including Russia are working to trim a global glut that triggered the 2014 market crash. “We have supportive elements in the market that didn’t exist before,” said Bob Yawger, director of futures at Mizuho Securities USA Inc. in New York. With supplies declining and a healthy global economy, “all the pieces are in place.”
Oil in New York has reached a level where profits are high enough to encourage a further expansion in U.S. drilling, compounding speculation that Organization of Petroleum Exporting Countries’ effort to tame the oversupply may prove self-defeating. West Texas Intermediate crude for February delivery fell 57 cents to settle at $61.44 a barrel on the New York Mercantile Exchange. The contract’s Thursday settlement at $62.01 was the highest close since December 2014.