West Texas Intermediate crude traded near the highest price in 14 months as U.S. stockpiles shrank the most this year. U.S. crude inventories dropped by 10.3 million barrels last week, according to the Energy Information Administration but they were only projected to decline by 2.25 million, a Bloomberg News survey showed.
The unrest in Egypt continues to concern those who believe it will disrupt Middle East oil supply.
Egypt’s army forced Mohamed Mursi from power a year after his election, fuelling speculation that the political turmoil may interrupt flows along the Suez Canal, or a pipeline that runs through the country.
Through the Suez Canal and the Suez-Mediterranean Pipeline, 2.24 million barrels of oil a day were shipped to Europe in 2011, according to the EIA, with the Middle East accounting for a third of crude output across the world last year. This further highlights the significance of the political unrest in Egypt on the oil industry as a whole.