Crude Oil prices rose for a third consecutive session, as government data showed a surprise drop in U.S. crude inventories and as the U.S. dollar turned lower, lifting dollar-denominated commodities prices.
Crude inventories fell modestly last week as imports declined and demand ticked up, the Energy Information Administration's (EIA) petroleum data showed Wednesday. The weekly EIA data also showed U.S. crude imports fell 0.9% to 8.58 million barrels a day, and total petroleum demand rose 1% to 18.5 million barrels a day. While demand was higher than a week ago, it's still down by more than 2% from a year ago.
Also supporting Oil prices, the U.S dollar weakened after a report showed new U.S. home construction slowed much more than forecast last month, while consumer prices rose more than expected. Crude oil prices are denominated in U.S. dollars, so a weaker dollar makes the commodity less expensive for investors holding other currencies. In addition, commodities have benefited from a dollar carry trade, whereby investors borrow cheap dollars to invest in hard assets.