Oil prices rally further as US crude stockpiles slide

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Oil prices rose strongly for a second day running on Wednesday after official data showed that crude inventories fell by far more than expected in the United States.

New York's main contract, light sweet crude WTI crude for delivery in February, rallied $1.61 to $98.85 a barrel.

Brent North Sea crude for February climbed by $1.11 to $107.84 in late London deals.

Crude inventories in the United States, the world's biggest oil-consuming nation, tumbled by 10.6 million barrels in the week to December 16, the US Department of Energy announced.

Analysts had expected crude stockpiles to have fallen by only 2.4 million barrels last week and the much larger draw-down could reflecting increasing demand and therefore activity in th economy.

Promising economic news from the US and Europe had already sent oil prices surging more than $3.0 on Tuesday, while tensions over major crude-producer Iran added to the buying, traders said.

© 2011 AFP

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