Oil exchange traded funds (ETFs) were higher Wednesday following a weekly supply report and news that Kuwait was temporarily halting oil exports due to sandstorms.
A report from the U.S. government Wednesday showed inventories of the motor fuel plunged the most in 12 years, Bloomberg reported.
Crude futures traded above $107 a barrel Wednesday on Kuwait’s decision to temporarily suspend crude exports because of sandstorms, the Associated Press reported.
Oil prices fell earlier this week with the pressure of Goldman Sachs bearish research notes and economic worries injuring the commodity. [Oil ETF Down 7% This Week.]
Oil prices tumbled for a second day Tuesday following a Goldman Sachs forecast calling for a fall of almost $20 in the price of Brent crude oil in coming month, while demand may drop off as prices remain high for now, says Caroline Valetkevitch for Reuters.
U.S. Oil Fund (NYSEArca: USO) is an ETF that invests in futures contracts. Futures are a promise to buy or sell a commodity for a set price on a future date. None of the ETFs that hold futures contracts claim to track the spot price of their respective commodities.
Other ETFs that play oil include PowerShares DB Oil Fund (NYSEArca: DBO) and the U.S. Commodity Brent Oil Fund (NYSEArca: BNO). Both funds invest in futures contracts. [CFTC Could Impede Growth of Commodity ETFs.]
PowerShares DB Oil Fund
Tisha Guerrero contributed to this article.