Oil prices rose for a second day on Wednesday after data showed crude inventories in the United States, the world’s largest oil user, fell more than expected, supporting demand sentiment.
Brent crude futures were up 30 cents, or 0.4%, at $77.89 a barrel at 05:24 GMT. West Texas Intermediate (WTI) crude futures were up 36 cents, or 0.5%, at $72.60 a barrel.
Oil gained nearly 2% in the previous session due to supply concerns following a supply disruption in Libya and ongoing regional tensions due to the Israel-Gaza war. However, trading on Monday opened the week with a decline of over 3%.
New attacks on shipping in the Red Sea by the Houthi militia in Yemen on Tuesday in support of the Palestinians and possible disruptions in the flow of oil tankers in the region also supported the increase in prices.
Oil prices are still hovering in a low range. Still, investors holding long positions are currently dominating the market mood, analysts say, referring to investors who bought futures in anticipation of prices rising.
Last week’s oil stock decline may have been more of a seasonal stock change, but it is thought to have helped ease downward pressure on oil prices.
U.S. crude oil inventories fell by 5.2 million barrels in the week ended Jan. 5, compared with forecasts for a 700,000-barrel increase in a survey of analysts, market sources said, according to figures released by the American Petroleum Institute (API) on Tuesday.
However, gasoline stocks increased by 4.9 million barrels, while distillate stocks increased by 6.9 million, above the estimated increase of 2.5 million and 2.4 million barrels, respectively.
Data from the EIA, the statistical arm of the US Department of Energy, will be released at 1530 GMT on Wednesday.
The EIA said on Tuesday it expects global liquid fuel consumption to increase by only 1.4 million barrels per day (bpd) in 2024, compared to an increase of 1.9 million barrels per day (bpd) in 2023, and growth could be lower.
