NEW YORK: Oil prices on Tuesday moved higher in anticipation of another large inventory draw from US crude stockpiles.
US benchmark West Texas Intermediate for September delivery rose 29 cents to close at $107.23 a barrel on the New York Mercantile Exchange.
European benchmark Brent for September delivery increased 27 cents, settling at $108.42 a barrel in London trade.
The gains came as investors anticipated another large drawdown in US oil?supplies. US crude stockpiles have notched unexpectedly large declines the last three weeks, helping to push oil?prices higher.
Analysts expect Wednesday's Department of Energy report to show a decline of 2.1 million barrels, according to a Dow Jones Newswires survey of analysts.
Anticipation of the report "halted the sell-off" in WTI, said Matt Smith, an analyst at Schneider Electric.
After trading at a sharp discount to Brent for much of the last few years, WTI in recent days has returned to near-parity with the European benchmark, at times even trading higher.
On Friday, WTI prices reached as high as $109.32 a barrel, a level last seen 16 months ago.
Smith said some downward pressure on WTI was inevitable after the recent surge. But after going lower in the morning, WTI moved into positive territory in the afternoon.
Smith said oil?also gained support from the latest round of violence in Egypt and from comments from Chinese Premier Li Keqiang that suggested China may enact additional economic stimulus to boost growth.
Michael Truscelli, a broker and trader at Paramount Options, said newsflow on Tuesday was generally "very quiet," but some traders were focused on oil-delivery problems in Libya.
"Problems with Libyan exports is what we heard," Truscelli said.