Oil Has Biggest Rally In 2 Weeks As Market Gears For Peak US Driving Season

NEW YORK (UrduPoint News / Sputnik - 27th May, 2022) Oil prices rallied their most in two weeks , gearing for the start of the peak US driving season that could see tens of millions of people taking to the road despite record high fuel prices.

After days of choppy trading, New York-traded West Texas Intermediate (WTI) crude for July delivery settled up $3.76, or 3.4%, at $114.09 a barrel on Thursday. It was the biggest one-day run-up for the US crude benchmark since May 13, when it surged 4%. WTI had moved little in the four sessions prior to Thursday that saw it lose a net 1.7%.

London-traded global crude benchmark Brent settled at $117.40 for a barrel meant for August delivery. That was a gain of $3.37, or 3% on the day. Like WTI, Thursday also also Brent's biggest one-day gain in two weeks.

Oil prices rallied after the American automobile Association said some 39 million Americans were expected to hit the road from Friday ahead of Monday's Memorial Day holiday that unofficially flags off the US summer driving season.

This is despite a gallon of gasoline retailing at record highs of more than $4.50 per gallon, it said.

"The latest round of US data suggest the economy is decelerating but the consumer is still spending and probably will be traveling a lot this summer," said Ed Moya, analyst at online trading platform OANDA.

Also helping oil market sentiment was data from Wednesday showing sharper-than-expected declines in US crude and gasoline stockpiles. US oil processing reached 93.2% of capacity last week, its highest since December 2019, as refiners maxed out fuel products to meet projected demand, data showed.