NEW YORK, Dec. 20 (UPI) -- An expected draw on U.S. crude oil inventories helped erase a brief downturn for crude oil prices, but momentum could be influenced by year-end movements.
A research note from S&P Global Platts said to expect a draw on U.S. crude oil inventories of about 2 million barrels, which could indicate some level of balance is emerging between supply and demand.
A glut of oil on the market in early 2016 helped pull crude oil prices below $30 per barrel, though sentiments of a return to balance during the summer pulled oil out of its drought. Movements in the Monday session were influenced heavily by tensions overseas when both a suspected terror attack rocked Germany and the Russian envoy to Turkey was assassinated in the span of a few hours.
Platts reported that crude oil may be flowing out of the U.S. market through the Gulf Coast as refiners there look to shed inventory for year-end tax purposes.
The price for Brent was up 1.5 percent to start the trading day at $55.72 per barrel. West Texas Intermediate, the U.S. benchmark price for oil, was up 1 percent to open in New York at $53.56 per barrel.
Industry data from the American Petroleum Institute on inventories is released Tuesday after the U.S. market closes. Official data from the U.S. Energy Information Administration are released about an hour after trading opens Wednesday.
Crude oil prices waxed and waned last week on dueling sentiments of balance. A report last week from the International Energy Agency said demand for oil could surpass the level of supplies available on the market at some point during the first half of the year provided members of the Organization of Petroleum Exporting Countries and other producers honor a production cap starting in January. According to OPEC, it will be the second half, not the first half of next year, that balance returns.
Russia, which would be a major contributor to a production cap from the non-OPEC side, has been an influential player in the oil market. Oil company Lukoil said this week it had no directions to cut production from some of its larger operations in Iraq, which initially balked at the production deal citing the need to finance counter-terrorism operations.
Russian President Vladimir Putin on Tuesday signed off on a federal budget that expects a $45.4 billion deficit next year. The budget is pegged on oil priced at around $40 per barrel.