Oil price rises to highest level since 2014

The benchmark North American oil price hit its highest level since 2014 on Wednesdayas two new data points came out showing supplies are drawing down, and an OPEC pledge to turn off the taps seems to be working.

A barrel of West Texas Intermediate rose 61 cents tosettleat $63.57 US in New York, after having tradedeven higher earlier in the day. That's the highest level for the U.S. oil benchmark since late 2014.

The catalyst seems to have been data from theAmerican Petroleum Institute, which said late Tuesdaythat U.S. crude inventories fell by 11.2 million barrels,to 416.6 million barrelsin the week leading to Jan. 5.

On top of that, adeal signed by oil-producing OPEC nations in November seems to be sticking. At the time, the cartel had pledged to extend its production cuts to get prices back to a more appealing level.

"The extension of the OPEC agreement ... and declining inventories are all helping to drive the price higher," said William O'Loughlin, investment analyst at Australia's Rivkin Securities.

Foreign exchange trader Shane Thomson of Cambridge Global Payments said oil traders "seem to be giving more credence to bullish data as of late."

"But if short-term influencers like the Iranian protests and Venezuela production issues were to be sorted out, a sharp price reversal could very well be in the cards."