Canadian Dollar Higher Amid Rising Oil Prices

The Canadian dollar rose against its major rivals in the European session on Thursday, as oil prices advanced after an inventory data showed that U.S. gasoline and distillate stocks fell more than forecast last week.

Data from the American Petroleum Institute showed on Wednesday that gasoline inventories fell by 4.6 million barrels and distillate stocks declined by 2.7 million barrels, compared to last week's increase of 3.68 million barrels and 345,000 barrels, respectively.

U.S. crude inventories rose by 5.2 million barrels for the week ended Oct. 8, while analysts expected a build of 140,000 barrels.

Oil prices also got a boost from the International Energy Agency's warning that demand could outpace supply until the end of this year, threatening the global economic recovery from the pandemic.

In its monthly oil report, the IEA said that record coal and gas prices as well as rolling blackouts were prompting the power sector and energy-intensive industries to turn to oil to keep the lights on and operations active.

The loonie firmed to more than a 3-month high of 1.2355 against the greenback, 1-1/2-year high of 1.4327 against the euro and a 5-1/2-year high of 91.95 against the yen, off its prior low of 1.2445, 2-day lows of 1.4432 and 90.91, respectively. The loonie is seen finding resistance around 1.23 against the greenback, 1.40 against the euro and 93.00 against the yen.

The loonie remained higher against the aussie, with the pair trading at 0.9171. This followed a 2-day low of 0.9191 hit at 8:15 pm ET. On the upside, 0.90 is possibly seen as the next resistance level.