Oil holds rally after report points to shrinking US stockpiles

Oil was steady near $58 a barrel as an industry report pointed to a drop in US crude stockpiles, adding to signs of easing supply.

Futures in New York have surged almost 12% over the past seven sessions to their highest level in more than a year as the market continues its recovery from the Covid-19 pandemic. The American Petroleum Institute reported crude inventories fell by 3.5 million barrels last week, according to people familiar.

Prompt timespreads for US crude and global benchmark Brent have recently firmed in a bullish backwardation structure, signaling tightening supplies, and the oil market is now offering its biggest yield in about a year.