Oil prices rise amid low inventories, strong demand for refineries


(MENAFN) Oil prices saw an uptick in early trading on Thursday, driven by a significant drop in gasoline and crude inventories as U.S. refineries ramped up their processing activities, reflecting robust demand. brent crude futures rose by 35 cents, or 0.4 percent, to USD85.43 per barrel, while U.S. West Texas Intermediate crude gained 36 cents, or 0.5 percent, reaching USD82.47 per barrel.

U.S. crude inventories fell sharply by 3.4 million barrels to 445.1 million barrels in the week ending July 5, far exceeding analysts' expectations of a 1.3 million-barrel decline, as reported in a poll. Similarly, gasoline stocks dropped by 2 million barrels to 229.7 million barrels, significantly more than the anticipated 600,000-barrel draw during the U.S. Fourth of July holiday week.

OPEC maintained its forecast for strong growth in global oil demand for 2024 and the following year. The organization noted on Wednesday that economic growth and increased air travel would continue to support fuel use during the summer months. However, gains were somewhat limited due to minor disruptions in refinery supplies and offshore production facilities caused by Hurricane Beryl.

Investors are also focused on upcoming U.S. inflation data, including the consumer price index report due on Thursday and the producer price index report scheduled for Friday. Federal Reserve Chairman Jerome Powell stated on Wednesday that the central bank would make interest rate decisions "when and as needed," countering speculation that a rate cut in September might be politically motivated ahead of the fall presidential election. 

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