SINGAPORE (AP) — Oil hovered above $93 a barrel Wednesday in Asia as concerns about supply disruptions supported a two-month, 21 percent rally.
Benchmark crude was down 46 cents to $93.21 a barrel at late afternoon Singapore time in electronic trading on the New York Mercantile Exchange. The contract rose $1.47 on Tuesday to settle at $93.67 in New York.
In London, Brent crude was down 56 cents at $111.44 on the ICE Futures exchange.
Crude has jumped from below $78 in June despite signs of weak economic growth and no official confirmation of expectations of another round of major monetary stimulus by the U.S. or Europe. Investor optimism has sparked a global stock market rally this week, which has helped carry crude prices higher.
The surge in crude has also been fed this week by supply disruptions after a fire at a Chevron refinery in California and pipeline explosions in Turkey that were carrying crude from Iraq.
"This week's price advance has easily exceeded our expectations and would appear to have some legs for further gains," energy trader and consultant Ritterbusch and Associates said in a report. "Supply disruptions are always difficult to predict but we will also suggest that the pop in risk appetite in recent days has exceeded our expectations given limited hard news regarding central bank stimulus."
The latest U.S. supply data suggested demand may be improving. The American Petroleum Institute said crude inventories plunged 5.4 million barrels last week while analysts surveyed by Platts, the energy information arm of McGraw-Hill Cos., had predicted a drop of 300,000 barrels.
Gasoline supplies rose 417,000 barrels last week, the API said.
In other Nymex energy trading, wholesale gasoline futures were down 1.2 cents at $2.98 a gallon and heating oil slid 1.5 cents to $2.98. Natural gas was up 0.3 cent at $2.97 per 1,000 cubic feet.