Oil rose above $69 a barrel on Wednesday, supported by news of a bigger-than-expected draw in U.S. crude oil stocks and growing geopolitical troubles in some OPEC member countries.
Crude traders appeared to brush off evidence from the Energy Information Administration (EIA) that U.S. distillate stocks jumped to their highest level in more than 10 years and that U.S. inventories of gasoline rose more than expected last week as refineries boosted output.
By 1507 GMT (11:07 a.m. EDT), U.S. crude for August delivery was up 20 cents at $69.44 per barrel. London Brent crude was up 20 cents at $69.00.
Traders said the EIA numbers were not as bearish as data released late on Tuesday by the American Petroleum Institute (API), allowing the market something of a relief rally.
That's the reason you're seeing crude futures coming back up from earlier lows here. There's a huge jump in refinery utilization and you can look at it both bearish or bullish, said Phil Flynn, analyst at Alaron Trading in Chicago.
The EIA and API data fed into a market sensitive to potential supply disruptions in some members of the Organization of the Petroleum Exporting Countries.
Multiple militant attacks on pipelines and oil installations in the Niger Delta recently have forced production stoppages at sites run by Agip
Iran's deputy oil minister Akbar Torkan was sacked on Monday, and sources said he was replaced for being close to defeated presidential candidate Mirhossein Mousavi. The world's fifth-largest oil exporter is wracked with its worst civil unrest in 30 years over a disputed presidential election.
Analyst Olivier Jakob of PetroMatrix in Switzerland said geopolitical concerns in OPEC members Iran and Nigeria were influencing investors in the oil markets.
There are some real disruptions to flows in the case of Nigeria. In the case of Iran, the strife has gone on long enough to be uncomfortable. We have to remember what happened in Venezuela.
Attacks on oil installations are not a risk we would consider, but we have to keep in mind what happened in Venezuela and the impact witch-hunting had on production levels, Jakob said.
(Editing by Anthony Barker)