Brent futures increased 35 cents, or 0.4% to $85.43 a barrel and U.S. WTI crude added 36 cents, or 0.5%, to $82.47 a barrel
Oil prices rose on Thursday as crude stocks dropped after U.S. refineries ramped up processing and as gasoline inventories eased, indicating stronger demand.
Brent futures increased 35 cents, or 0.4% to $85.43 a barrel. U.S. WTI crude added 36 cents, or 0.5%, to $82.47 a barrel.
U.S. crude inventories dropped by 3.4 million barrels to 445.1 million barrels in the week ended July 5.
Gasoline stocks dropped by 2 million barrels to 229.7 million barrels, much bigger than the 600,000-barrel draw analysts expected during the U.S. Fourth of July holiday week.
The Organization of the Petroleum Exporting Countries (OPEC) also stuck to its forecast for relatively strong growth in global oil demand in 2024 and 2025, saying on Wednesday that resilient economic growth and air travel would support fuel use in the summer months.
Gains were, nevertheless, capped as supply disruptions at refineries and offshore production facilities from hurricane Beryl were minimal.
Meanwhile, U.S. inflation data due this week include the Consumer Price Index (CPI) on Thursday and the Producer Price Index (PPI) report on Friday, both of which could set the tone for the market.
Expectations of a 25 basis point rate cut by September rose to 74% from nearly 70% on Tuesday and 45% a month ago, as per CME’s FedWatch.
Lower interest rates decrease the cost of borrowing, which can boost economic activity and oil demand.
Fed Chair Jerome Powell said on Wednesday the U.S. central bank will make interest rate decisions “when and as” they are needed, pushing back on a suggestion that a September rate cut could be seen as a political act ahead of the fall presidential election.
