Oil prices rally 3% after weekly report showed a surprise drop in supplies

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February 27, 2019 11:54am NYSE:USO

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From Myra P. Saefong: Oil futures gained more ground on Wednesday after data from the Energy Information Administration revealed that U.S. crude supplies unexpectedly dropped by 8.6 million barrels. The decline followed five straight weeks of increases and defied most market forecasts. Informa Economics expected a rise of 3.5 million barrels. The American Petroleum Institute data on Tuesday showed a decline of 4.2 million barrels, according to sources. Supplies of gasoline fell by 1.9 million barrels, while distillates edged down by 300,000 barrels last week, according to the EIA. Informa Economics expected supply declines of 1.5 million barrels for gasoline and 2.5 million barrels for distillates. April West Texas Intermediate crude CLJ9, +3.30% was up $1.45, or 2.6%, at $56.95 a barrel on the New York Mercantile Exchange. It was trading at $56.40 before the data.

The United States Oil Fund LP (USO) was trading at $11.97 per share on Wednesday morning, up $0.34 (+2.92%). Year-to-date, USO has declined -0.33%, versus a 4.75% rise in the benchmark S&P 500 index during the same period.

USO currently has an ETF Daily News SMART Grade of A (Strong Buy), and is ranked #1 of 108 ETFs in the Commodity ETFs category.

This article is brought to you courtesy of MarketWatch.

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