Oil prices rose on Thursday, extending a rally the previous day. This was supported by optimism about U.S. fuel demand after falling crude and gasoline stockpiles; reports that OPEC+ may delay a planned output hike also provided support.
Brent crude futures rose 47 cents, or 0.65%, to $73.02 a barrel by 0505 GMT. WTI Crude futures, rose 43 cents, or 0.63%, to $69.04 a barrel.
Both contracts rose more than 2% on Wednesday after falling more than 6% earlier as the risk of a wider conflict in the Middle East receded.
U.S. gasoline inventories unexpectedly fell to a two-year low in the week ended Oct. 25 on stronger demand, while the Energy Information Administration (EIA) said crude oil inventories also fell by a surprising margin as imports fell.
Some analysts had expected U.S. gasoline and crude oil inventories to rise. The surprise decline in gasoline inventories provided a buying opportunity as demand appeared stronger than expected.
Expectations of a possible delay in the OPEC+ production increase also supported expectations. If there was a delay, WTI could return to the $70 level.
OPEC+ is scheduled to meet on Dec. 1 to decide on its next policy steps, and OPEC+ could delay its planned December oil output increase by a month or more amid concerns about weak oil demand and rising supply.
The group is scheduled to increase production by 180,000 barrels per day (bpd) in December. It had postponed the increase from October due to falling prices.
OPEC+’s decision to delay the increase could come next week.
Production activity in China, the world’s largest oil importer, rose for the first time in six months in October, suggesting that stimulus measures are working.
Markets are awaiting the results of the U.S. presidential election on Nov. 5 and more details on China’s economic stimulus.
China may approve more than 10 trillion yuan ($1.4 trillion) in debt issuance over the next few years on the final day of its parliamentary session from Nov. 4-8, the prime minister said.
In the Middle East, Lebanon’s prime minister on Wednesday expressed hope that a ceasefire deal with Israel would be announced within days. The ceasefire demand for Lebanon comes alongside a similar diplomatic effort to end hostilities in Gaza. However, the market impact is likely to be weak.
