Oil climbed as much as 9.9 percent after an official said Chinese Premier Wen Jiabao may announce new measures, adding to a 4 trillion yuan ($585 billion) spending plan. A government report today showed an unexpected decline in U.S. crude-oil inventories last week as OPEC cut production.
Crude oil for April delivery rose $3.64, or 8.7 percent, to $45.29 a barrel at the 2:30 p.m. close of floor trading on the New York Mercantile Exchange. Futures touched $45.76, the highest since Jan. 27. Prices are up 1.5 percent so far this year.
Crude oil supplies fell 757,000 barrels to 350.6 million barrels in the week ended Feb. 27, the Energy Department said. Inventories were forecast to rise 1 million barrels, according to the median of analyst estimates in a Bloomberg News survey.
Stockpiles at Cushing, Oklahoma, where New York-traded West Texas Intermediate crude is delivered, declined 553,000 barrels to 34 million barrels last week, the report showed. Inventories in the week ended Feb. 6 were the highest since at least April 2004, when the department began keeping records for the location.
The high inventories at Cushing have depressed the West Texas price so that Brent crude oil traded in London is at a premium to the U.S. grade.
Brent crude oil for April settlement increased $2.18, or 5 percent, to $45.88 a barrel on London’s ICE Futures Europe exchange. The discount of oil in New York to the Brent grade in London narrowed to 59 cents a barrel, the lowest since Jan. 2.
The Organization of Petroleum Exporting Countries, due to meet again on March 15, cut output by 2.7 percent in February, a Bloomberg News survey showed. Production from OPEC averaged 27.78 million barrels a day last month, down 770,000 from January, according to the survey of oil companies, producers and analysts. Output in January was revised 20,000 barrels a day lower.