NEW YORK ( TheStreet) -- Oil prices staged a small rally Wednesday on speculation of further monetary easing by the Federal Reserve and a decline in crude stockpiles.
Brent crude oil for November delivery was rising 68 cents to $109.55 a barrel and West Texas Intermediate (WTI) crude for October delivery was adding 70 cents to $86.14.
The Department of Energy on Wednesday reported that crude oil inventories declined 2.2 million barrels for the week ended Aug. 19 and the American Petroleum Institute (API) on Tuesday evening said that crude inventories had declined 3.3 million barrels in that period.
This, coupled with anticipation that Federal Reserve chairman Ben Bernanke could announce additional stimulus measures during his speech this Friday at the Fed's annual symposium in Jackson Hole, Wyo., unleashed oil price potential to the upside.
Also providing some additional mileage for oil prices was
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declaration of force majeure on its Nigerian Bonny Light exports until October, following recurrent attacks on its pipelines in Nigeria.
A handful of negative data was released on Wednesday, but traders were putting aside some of that for now.
Both the Department of Energy and API had also reported a big 1.4 million barrels and 6.4 million barrels build in gasoline stockpiles. This, as MasterCard Advisors SpendingPulse's latest weekly U.S. gasoline demand report said gasoline demand decreased by 4.2% compared to a comparable week a year ago and Moody's lowered its Japanese debt rating citing weak growth prospects.
The SpendingPulse macroeconomic indicator is based on aggregate sales and services activity in the MasterCard payments network.
The markets were also disregarding news of the possibility that Libyan leader Col. Moammar Gadhafi has essentially been toppled by rebel leaders and the civil war was coming to an end.
About 1.7 million barrels a day of oil production was lost to the Libyan civil war.