Oil prices experienced a slight uptick on Thursday, driven by a smaller-than-expected increase in U.S. crude inventories for the previous week, coupled with notable draws in fuel stocks.
Brent crude futures increased by 15 cents to reach $83.11 a barrel, while U.S. West Texas Intermediate crude futures rose by 18 cents to $79.31 a barrel. This upward movement followed a 1% increase in benchmarks observed on Wednesday, fueled by a crude inventory rise of 1.4 million barrels, falling short of the 2.1 million-barrel forecast predicted by analysts in a Reuters poll. The Energy Information Administration (EIA) data revealed that gasoline and distillate stocks recorded larger declines than anticipated.
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Meanwhile, a Reuters poll of foreign exchange strategists indicated an expectation of a strong U.S. dollar persisting in the near term. Markets are anticipating a potential delay in the U.S. Federal Reserve’s first interest rate cut to the latter half of this year. Federal Reserve Chair Jerome Powell emphasized uncertainty surrounding inflation progress while affirming the central bank’s intention to lower its benchmark interest rate within the year.
Market attention is also directed towards upcoming Chinese trade data, with Beijing aiming for a GDP growth target of around 5% for the current year. However, analysts remain skeptical about the trade’s ability to significantly propel the economy forward, considering recent trends in imports and exports.
In addition to these factors, reflecting supply constraints, Saudi Arabia, the leading oil exporter, raised prices for its flagship Arab Light crude sold to Asia in April to $1.70 a barrel above the Oman/Dubai average, according to trade sources.
