UPDATE 8-Oil prices jump over $2/bbl after drawdown in U.S. stocks

Reuters

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    * U.S. crude, fuel stockpiles fall in wake of Hurricane Ida
-EIA
    * Vaccines set to unleash pent-up oil demand, IEA says
    * China's daily oil refinery output hits 15-month low in
August

 (Updates with additional comment, settlement prices.)
    By Jessica Resnick-Ault
    NEW YORK, Sept 15 (Reuters) - Oil prices rose over $2 a
barrel on Wednesday after government data showed a
larger-than-expected drawdown in U.S. crude inventories, and on
expectations demand will rise as vaccination roll-outs widen.  
    U.S. crude oil stockpiles fell last week to the lowest since
September 2019, the U.S. Energy Information Administration said,
extending their drawdown after Hurricane Ida late August shut
numerous refineries and offshore drilling production.
 urn:newsml:reuters.com:*:nL1N2QG25L  EIA/S 
    Brent crude  LCOc1  rose $1.86, or 2.5%, to settle at $75.46
a barrel. U.S. West Texas Intermediate (WTI) crude  CLc1 
climbed $2.15, or 3.1%, to $72.61 a barrel.
    Earlier in the session, Brent touched $76.13 a barrel, a
contract high, and the highest outright price since late July.
    "Brent and WTI pricing are up strongly today, back near the
peaks we hit earlier in the summer," said Pavel Molchanov, an
analyst at Raymond James. "Oil momentum has continued ever since
late August following Hurricane Ida as the Gulf of Mexico still
struggles to fully restore production."
    U.S. crude and distillate inventories last week fell more
than analysts expected, while gasoline stocks also declined, but
fell slightly short of analysts' expectations.
    Crude inventories  USOILC=ECI  fell by 6.4 million barrels
in the week to Sept. 10 to 417.4 million barrels, compared with
analysts' expectations in a Reuters poll for a 3.5
million-barrel drop.  EIA/S 
    "We have seen large crude and product draws which is
supportive to the energy complex," said Tony Headrick, energy
market analyst at CHS Hedging. "The tropical storm that just
came through slowed down recovery efforts from Hurricane Ida and
we will continue to see the effects from Ida for the next few
reports."
    Tropical Storm Nicholas moved slowly through the Gulf Coast
on Tuesday, leaving hundreds of thousands of homes and
businesses without power, although Texas refineries ran
normally.  urn:newsml:reuters.com:*:nL1N2QG0DJ  urn:newsml:reuters.com:*:nL1N2QG0YO 
    Damage from the storm comes two weeks after Ida knocked a
significant amount of Gulf Coast refining capacity offline.
    "This year’s hurricane season has a much greater and
longer-lasting impact on the global oil balance than in previous
years," said Tamas Varga, oil analyst at London brokerage PVM
Oil Associates.
    Oil prices also found support from the International Energy
Agency (IEA), which said on Tuesday vaccine roll-outs would
power a rebound, after a three-month slide in global oil demand
due to the spread of the Delta coronavirus variant and renewed
pandemic restrictions.  urn:newsml:reuters.com:*:nL1N2QG0JH
    But oil price gains were capped by a fall in China's crude
throughput in August, with daily refinery runs hitting the
lowest since May 2020 and overall factory output faltering.
 urn:newsml:reuters.com:*:nL1N2QH048  urn:newsml:reuters.com:*:nL4N2QH0XZ
    

 (Additional reporting by Noah Browning; Editing by Marguerita
Choy, David Evans and Sonya Hepinstall)
 ((Jessica.Resnick-Ault@thomsonreuters.com; +1 332 219 1145;))

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