Surprise drop in US crude inventories boosts oil prices, shifts focus away from Middle East tensions

Oil prices rose in early trade on Wednesday, extending their gains in the previous session after business data showed a surprise drop in US crude inventories last week, a sign of stronger demand and a shift attention away from enemies in the Middle East.

Trade prices

Brent crude futures rose 24 cents, or 0.27%, to $88.66 a barrel, at the time of writing, while US West Texas Intermediate crude futures increased 21 cents, or 0.25%, to $83.57 a barrel.

Market sources, citing figures from the American Petroleum Institute, said US crude inventories fell 3.237 million barrels in the week ended April 19, while six analysts polled by Reuters had expected an increase of 800,000 barrels. .

Traders are waiting for official US data on oil and product inventories which is expected to be released at 10:30 am US time (14:30 GMT) to confirm the large decline in inventories.

At the same time, the United Kingdom and the European Union are expected to cut interest rates next June, which could support economic growth, thus increasing demand for oil.

Business activity in the euro zone and the United Kingdom grew this month at the fastest pace in nearly a year, indicating that economic growth “continues to gain momentum,” it said. Capital Economics in note.

Oil continued its uptrend in Wednesday’s trade (Shutterstock)

Developments in the Middle East

Traders largely ignored the latest developments in the Middle East in early trading on Wednesday, with residents saying Israel had stepped up its strikes across Gaza, in some of the worst waves heaviness of bombing in weeks.

Brent crude futures rose $1.42, or 1.6%, yesterday, Tuesday, to settle at $88.42 a barrel, while US West Texas Intermediate crude futures rose $1.46, or 1.8%, to $83.36 a barrel.