Oil prices increased on Thursday, recovering from multi-month lows as traders reacted to a possible delay in planned output increases by OPEC+ and a significant drop in U.S. crude inventories. However, concerns about demand continue to cap gains.
The American Petroleum Institute (API) reported a larger-than-expected decrease in U.S. crude oil inventories, with a draw of 7.431 million barrels last week.
This exceeded analysts’ 1 million barrel decline forecast in a Reuters poll.
This unexpected draw provided some support for oil prices.
John Evans, an analyst at PVM, noted, “There is a pause of breath and light reprieve for oil prices this morning,” referring to the supportive API report.
By 0810 GMT, Brent crude for November delivery was up 42 cents, or 0.6%, trading at $73.12 per barrel. This follows a dip to its lowest level since Wednesday, December.
Meanwhile, U.S. West Texas Intermediate (WTI) crude for October gained 37 cents, or 0.5%, to $69.57.
Additional support came from discussions within OPEC+—the coalition of OPEC members and allies led by Russia—about potentially delaying output increases scheduled for October.
OPEC+ had planned to increase production by 180,000 barrels per day (bpd) as part of a gradual reduction of recent cuts totalling 2.2 million bpd.
However, ongoing weak demand in China and the potential end of a dispute obstructing Libyan oil exports have prompted the group to reconsider.
The U.S. Energy Information Administration (EIA) is expected to release its official oil stocks data at 1430 GMT, which may provide further insight into market dynamics.
In addition, financial markets are awaiting further U.S. economic indicators, including job data, which could influence oil prices and broader market sentiment.
