Oil rises as US inventories decline

Oil drilling rigs

Oil prices rose today, Jan. 25, supported by official data that showed a decline in crude stockpiles in the US over the past week, as well as hopes for a recovery in the Chinese economy after the Central Bank reduced the legal reserve ratio for banks.

International benchmark Brent crude was trading up 0.40% at $80.36 a barrel, at 09:21 am Makkah time. West Texas Intermediate (WTI) crude gained 0.52% to $75.48 per barrel.

US Energy Information Administration data released on Jan. 24 showed that the country's oil inventories fell by 9.2 million barrels last week, compared to expectations of a decline of 1.2 million barrels.

"A significant drop in the US oil inventories and expectations of China's economic recovery and more stimulus measures supported oil prices," said Toshitaka Tazawa, Analyst at Fujitomi Securities, according to a Reuters report. "Tensions in the Middle East were also behind buying," he added.