Brent Steady Above $107 With Ukrainian Civil War Looking Likely
Brent crude oil was steady at $107.24 at 6:15 GMT on Wednesday morning following a US inventory report which showed an unexpected drop in US stocks.
The commodity picked up nearly 20 cents in the early hours after ending the day on Tuesday 66 cents lower.
The American Petroleum Institute released a report on Tuesday which showed that US crude inventories were down 1.8 million barrels for the week ending on May 2nd. The figure surprised analysts, who were expecting to see an increase of 1.4 million barrels.
Now, investors are looking forward to figures from the US Energy Information Administration for confirmation of the decline. The EIA is set to release its weekly report later in the day on Wednesday.
See also: Sohn Conference Moves Markets Once Again
US economic data also helped keep a floor under prices as investors were reassured that the nation's disappointing first quarter data was due to severe winter weather.
Trade data showed that exports rose to their second highest level ever recorded, which narrowed the US' trade deficit and suggested a rise in energy demand.
However the ongoing conflict in Ukraine remained the largest driver of oil prices as the situation looked near the brink of a civil war. CNBC reported that with the death toll rapidly rising and violence spreading across the country, peace efforts are looking less and less likely. Ukraine and Russia have blamed each other for the escalation, and both sides are unwilling to back down.
Meanwhile the US is preparing new sanctions for the possibility that Russia will intervene in the crisis by preventing elections from happening or supporting another separatist referendum. Most expect that Brent prices will reach above $110 if there is any movement of Russian troops across Ukraine's border.
© 2014 Benzinga.com. Benzinga does not provide investment advice. All rights reserved.