Oil prices climb as US stock drawdown eases supply glut fears

Oil costs edged increased on Thursday after knowledge confirmed US crude inventories fell once more, easing concern a couple of provide glut, although lingering fears over the worldwide financial fallout from the Covid-19 pandemic capped positive factors.

Brent crude futures for July supply have been buying and selling up 17 cents, or 0.5%, at $35.92 per barrel at 0024 GMT. US West Texas Intermediate (WTI) crude futures for July have been up four cents, or 0.1%, at $33.53 a barrel.

US crude inventories fell by 5 million barrels final week, towards expectations in a Reuters ballot for a 1.2 million-barrel rise, Energy Information Administration (EIA) knowledge confirmed, whereas shares on the Cushing, Oklahoma, supply hub dropped by 5.6 million barrels.

“While signs that WTI storage pressures are abating is positive for prices, the latest report shows that the fall in stocks owes more to supply factors than growing product demand,” Capital Economics stated in a notice issued on Wednesday.

Prices have been boosted recently by transport knowledge exhibiting the Organization of the Petroleum Exporting Countries, Russia and different allies, a bunch often known as OPEC+, are complying with their pledge to chop 9.7 million barrels per day (bpd).

OPEC itself is inspired by the rally in costs and robust adherence to output lower pledges, its secretary common stated, though sources say the group has not dominated out additional steps to help the market.

“We expect this to be the story for some time yet as OPEC+ cuts help to put a floor under prices in the second half of this year,” Capital Economics stated.

Still, lingering considerations concerning the financial fallout from the pandemic, particularly within the United States, the world’s greatest oil client, have utilized downward strain on costs.

Federal Reserve policymakers repeated a vow to take all steps essential to shore up the US financial system, minutes from the US central financial institution’s April 28-29 coverage assembly launched on Wednesday confirmed.