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Oil rallies on US inventories data

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Oil prices surged today amid renewed concerns over supplies from the Middle East and North Africa region and bullish US inventories data.

The US Department of Energy said today that while oil stockpiles added 1.7 million barrels, which was a larger gain than expected, gasoline inventories shed 4.2 million barrels, signalling an increase in demand.

The fighting in Libya seems to be nearing its end, at least according to the son of the country’s long time ruler Muammar Gaddafi’s son Seif al-Islam.

The rebels have lost control over many of the towns they have taken over during a month of intense fighting. Gaddafi loyalists are currently approaching the rebel stronghold of Benghazi, where the opposition is preparing to make its last stand.

Seif al-Islam has stated that the rebel army would be defeated within the next 48 hours.

However, even if the civil war does come to an abrupt end and Gaddafi gets back in change, uncertainty will still remain as the oil rich Libya will more than likely fall under heavy sanctions from the United Nations.

Meanwhile, Japan’s nuclear crisis appears to be far from over. The Fukushima-1 nuclear plant has experienced a fourth explosion and radiation in the area has reached dangerous levels.

US light, sweet crude for April delivery, which is currently the most actively traded contract on the New York Mercantile Exchange (NYMEX), climbed to US$99.27/barrel, while May crude reached US$100.22/barrel.

April Brent crude rose to US$111.40/barrel on the ICE Exchange.

BP (LON:BP) added 1%, while fellow supermajor Shell (LON:RDSB) declined 1%.

Tullow Oil (LON:TLW) advanced 2.1%, while BG Group (LON:BG) lost 1.5% and Cairn Energy (LON:CNE) held steady.

Engineering firms Petrofac (LON:PFC) and Amec (LON:AMEC) shed 1.8% and 1.2% respectively.

Heritage Oil (LON:HOIL)
led the midcaps, surging 4%.

Soco International (LON:SIA) posted a small gain.

JKX Oil & Gas (LON:JKX) slipped 2.4% and Salamander Energy (LON:SMDR) declined 1.1%.

Melrose Resources (LON:MRS)
and Premier Oil (LON:PMO) declined marginally.

Service company Wood Group (LON:WG) dipped 1.5%.

Iraq operating Petrel Resources (LON:PET) was among the top risers in the sector, rallying 15%.

Oil & gas sector focused investor Solo Oil (LON:SOL) and EU operating Mediterranean Oil & Gas (LON:MOG) tacked on about 10%.

Europa Oil & Gas (LON:EOG) advanced 6%.

Quick facts: Brent Crude Oil

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LSE:BRENT
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