The price of oil jumped almost 3% on Wednesday to the highest level in more than a year after a report showed a surprising drop in U.S. stockpiles of crude.
Crude futures were up $1.30, trading at more than $52 per barrel. That’s the highest level since July 2015.
A government report showed U.S. stockpiles unexpectedly fell by 5.2 million barrels last week. Investors were expecting a rise of 2.1 million barrels.
Analysts including Christophe Barraud, chief economist at Market Securities, said the drop could be explained in part by an outage in a pipeline that delivers half a million barrels a day to a storage facility in Oklahoma.
Investors bullish on oil are hoping the unexpected drop is signal that the global oil glut is easing. Oil prices have crashed over the past two years as the world’s biggest producers have sought to defend their market share and refused to cut production.
Low prices have hurt oil-producing nations, forcing them to slash spending. The Saudi-led OPEC oil cartel finally agreed to slash production in September.