Oil prices gain as US inventory withdrawals point to strong demand
Brent crude futures were up 13 cents, or 0.19 per cent, to US$66.97 a barrel at 0055 GMT, after gaining 1.6 per cent in the previous session. US West Texas Intermediate (WTI) crude futures rose 15 cents, or 0.24 per cent, to US$62.86, after climbing 1.4 per cent on Wednesday.
US crude inventories fell by 6 million barrels last week to 420.7 million barrels, the US Energy Information Administration said on Wednesday, versus analysts' expectations in a Reuters poll for a 1.8 million-barrel draw.
Gasoline stocks dropped by 2.7 million barrels, versus expectations for a 915,000-barrel draw, the EIA said, indicating steady driving demand during the summer travel season. That was also seen in a jump in the four-week average for jet fuel consumption to its highest since 2019.
"Crude oil prices rebounded as signs of strong demand in the US boosted sentiment," Daniel Hynes, senior commodity strategist at ANZ, said in a note on Thursday.
Still, Hynes cautioned that some "bearish sentiment remains evident as traders continue to monitor negotiations to end Russia's war against Ukraine."
Russia said on Wednesday attempts to resolve security issues relating to Ukraine without Moscow's participation were a "road to nowhere," as US and European military planners have begun exploring post-conflict security guarantees for Ukraine.
The drawn-out efforts to secure peace in Ukraine mean that Western sanctions on Russian oil supply continue to remain in place. The possibility of further US sanctions and tariffs on Russian oil buyers also hang over the market.
Russia, however, remains adamant it will keep providing crude to willing buyers, with Russian diplomats in India saying on Wednesday the country expects to continue supplying oil to India despite warnings from the US
US President Donald Trump has announced an additional tariff of 25 per cent on Indian goods from August 27 because of their Russian crude purchases. The European Union has also sanctioned Indian private refiner Nayara Energy, which is backed by Russian oil company Rosneft.
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