US crude oil inventories fell sharply last week in a sign that low prices may finally be pushing energy companies to slow production.

Crude oil stocks slid by 5.9m barrels last week, the US Energy Department said, compared to expectations of a 1.4m increase. Still, at 484.8m barrels total, commercial stocks remain near levels not seen during this time of year for the past 80 years, the Energy Department said.

Crude prices have collapsed by about 35 per cent this year amid a glut in global supply. However, large and small producers have begun indicating they plan on cutting back dramatically on investment next year, which could begin easing the supply.

US crude oil prices were up 3.5 per cent at $37.44 a barrel on the heels of the report, extending a gain from earlier in the morning. Brent, the international standard, rose 3 per cent to $37.19.

Get alerts on Front page when a new story is published

Copyright The Financial Times Limited 2019. All rights reserved.
Reuse this content (opens in new window)

Comments have not been enabled for this article.

Follow the topics in this article