Oil prices rose on Wednesday, supported by expectations of lower US crude inventories and the latest output cut targets set by the OPEC+ producer alliance.
Brent crude futures were up 45 cents, or 0.5%, to $85.39 a barrel as of 0352 GMT. West Texas Intermediate crude (WTI) rose 40 cents, or 0.5%, to $81.11 a barrel.
The gains came as an industry report showed U.S. crude inventories dropped nearly 4.3 million barrels in the week ending March 31. The official inventory report of the U.S. That will be much clear after the Energy Information Administration’s (EIA) data is released Wednesday at 1430 GMT.
The OPEC+ plan will increase the group’s total cut volume to 3.66 million bpd, including the 2m bpd cut last October, which equates to about 3.7% of global demand.
Continuing to cut production was one of the latest targets set by the Organization of the Petroleum Exporting Countries (OPEC) and its allies, including Russia.
Any news that the oil market will stay tighter will push prices higher as energy traders try to digest OPEC+’s surprise output cut.
In Asia, data showed Japan’s services sector grew at its fastest pace in more than nine years in March.
However, weak production activity in the US and China, the two largest oil consumers, has prevented oil prices from rising further despite tighter supply expectations following the OPEC+ cuts.
Analysts expect traders to look for clues to broader economic trends from US nonfarm payroll data, due later this week. US non-farm payroll data will likely be the most influential economic data driving broad market movements.
