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Shares in US energy companies raced higher as the price of oil rallied on the back of bullish data on crude oil inventories.

The S&P 500 energy sector, which tracks large companies in the industry, was up by almost 1 per cent in mid-morning trading in New York. Meanwhile, the small-cap focused Russell 2000 energy benchmark jumped 1.6 per cent.

Wednesday’s gains came as the price of US crude oil advanced by 1.4 per cent after a weekly reading on oil stocks. American crude inventories rose less than expected last week, while gasoline stocks, which serve as a barometer for demand, fell sharply.

Shares in oil companies have had a tough month amid mounting concern over high levels of US crude supplies. The S&P 500 energy index is still off by 1.4 per cent since the end of February, while the Russell barometer is down by 5.1 per cent over the period.

Copyright The Financial Times Limited 2017. All rights reserved.
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