Oil prices enjoyed 3 percent gains overnight and extended their rally into Thursday, enjoying their biggest day of gains since December 1, 2016. The gains resulted from news that U.S. inventories fell substantially in conjunction with a renewed support by Iraq and Algeria to extend OPEC’s production cuts. Reports from the Energy Information Administration showed that U.S. stockpiles were down nearly 5.2 million barrels, a huge difference from the 1.8 million barrels expected.

U.S. WTI was trading at $47.38 per barrel as of 6:20 a.m. GMT and Brent was at $50.47 per barrel, a 0.5 percent rise.  

Asian stocks road the coattails of oil’s increases by posting gains in most markets.Hong Kong’s Hang Seng index was up 0.26 percent while Japan’s Nikkei 225 was up 0.34 percent. MSCI’s broadest index of shares outside Japan was up 0.3 percent. Not surprisingly, the global gains were buoyed by gains in the energy sector.  

Currency Swings

The dollar enjoyed four consecutive sessions of gains this week, but broke the streak on Thursday by inching slightly lower to trade at 114.17 against the yen, just under a 0.1 percent drop. Gold moved up as the dollar eased, trading at $1,220.76 per ounce on Thursday morning. The dollar also struggled against the euro, trading relatively flat on Thursday. 

The Canadian dollar was under pressure during Thursday’s early trade session after Moody’s Investor Service downgraded six Canadian banks. The Canadian dollar was trading at $1.3734.