NEW YORK, Dec 12: Oil jumped $3 to $93 a barrel on Wednesday as the US Federal Reserve and several other major central banks moved to ease credit tensions and US crude stocks fell to the lowest point since early 2005.
US oil traded up $3.00 higher to $93.02 a barrel by 1804 GMT, while London Brent crude traded up $2.68 at $92.67 a barrel.
Crude prices extended on Tuesday’s gains of more than $2 after the Fed announced the creation of a temporary short-term lending facility to ease credit market strains in concert with market-calming actions by the Bank of England, the European Central Bank and other major central banks.
“The crude market has risen here more on the Fed action as its move on liquidity will help economic activity overall,” said Kyle Cooper, research director at IAF Advisors in Houston.
The move came after the Fed cut interest rates by a quarter point on Tuesday, disappointing some market players hoping for a larger cut to revive the flagging US economy.
Worries about the economic health of the world’s top consumer have sent oil crashing down from peaks over $99 a barrel in late November, after winter supply concerns sent prices on a record rally from below $70 in mid-August.
US government data showing a 700,000-barrel decline in US crude inventories last week also boosted prices, sending stockpiles down to their lowest level since March 2005.—Reuters
