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Brent crude rose to a two-week high after OPEC's Secretary-General said the recent plunge in prices doesn't reflect the balance between supply and demand. West Texas Intermediate gained before government inventory data.
Both grades are rebounding after falling more than 20 percent from this year's high in June. Shale oil drillers will be hurt by the fall in crude prices before members of OPEC because their costs are higher, OPEC's Abdalla El-Badri said in London today. WTI gained on expectations that U.S. stockpiles of gasoline and diesel fell last week.
"OPEC is trying to talk the market up a little bit," said John Kilduff, a partner at Again Capital LLC, a New York-based hedge fund that focuses on energy. "A draw in refinery product stocks is going to be bullish. There is some short-covering going on."
Brent for December settlement gained 99 cents, or 1.2 percent, to $87.02 a barrel at 9:25 a.m. New York time on the London-based ICE Futures Europe exchange. The contract reached an intraday high of $87.74, the most since Oct. 14. The volume of all futures was 13 percent below the 100-day average.
WTI for December delivery rose 72 cents, or 0.9 percent, to $82.14 a barrel on the New York Mercantile Exchange. Volume was 8 percent below the 100-day average. Brent traded at a premium of $4.88 to WTI on the ICE.
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