Good News....LONDON (Reuters) - Oil prices rose on Wednesday after a report of falling U.S. inventories and signs that U.S. oil production growth was leveling off after several years of very sharp increases.
A report by industry body the American Petroleum Institute (API) on Tuesday showed a much sharper weekly fall in U.S. crude stocks than expected.
The API report followed a prediction by the U.S. government that domestic oil production would fall more strongly and for longer than expected.
"It would be madness to try and talk bearish," said Tamas Varga, oil analyst at London brokerage PVM Oil Associates.
Brent crude prices rose $1.48 to a two-week high of $66.36 a barrel and was trading around $66.08, up $1.20 cents, by 6.30 a.m. EDT. U.S. light crude was up $1.36 at $61.50.
U.S. crude stocks fell 6.7 million barrels to 473.1 million last week, API data showed, compared with analysts' expectations for a 1.72 million barrel drop.
Weekly government oil stocks data to be published later on Wednesday were expected to add to the bearish momentum, traders said.
The U.S. Energy Information Administration on Tuesday revised its forecast for domestic oil production, saying it now expected a drop of 160,000 barrels per day (bpd) in U.S. oil output next year, compared with a previous forecast of a rise.
The EIA said U.S. oil production growth would only resume later next year.
The U.S. government agency also raised its global 2015 oil demand forecast by 20,000 bpd to 1.25 million bpd, adding to bullish fundamentals.
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