Oil prices rose on Wednesday as positive data from the US indicates that demand in the country is increasing while new COVID curbs in China caps further price increases.
International benchmark Brent crude traded at $98.25 per barrel at 10.28 a.m. local time (0728 GMT) for a 0.41% gain from the closing price of $97.84 a barrel in the previous trading session.
American benchmark West Texas Intermediate (WTI) was at $92.02 per barrel at the same time for a 0.41% rise after the previous session closed at $91.64 a barrel.
The American Petroleum Institute (API) announced its estimate of a rise of over 593,000 barrels in crude oil inventories in the world’s largest oil-consuming country, the US, late Tuesday, relative to the market expectation of a 633,000-barrel fall.
However, distillate stocks, which include diesel and jet fuel, decreased by around 1.7 million barrels while gasoline inventories decreased by nearly 3.4 million barrels.
A significant drop in inventories indicates an increase in crude demand in the US, assuaging market concerns over dwindling demand.
Limiting the price upticks, China decided to impose fresh COVID-19 curbs, putting millions of people under strict lockdowns in the southern tech hub of Shenzhen to southwestern Chengdu and in northeastern port of Dalian.
Investors are now keeping tabs on the next OPEC+ meeting on Sept. 5 when the group will decide on its production schedule for October.
The group’s ongoing production cut agreement will also expire in September and further cuts are expected amid warnings of several OPEC members about involatile market situation and need to correct prices.
Meanwhile, the recent unrest in OPEC's second-largest oil producer, Iraq, fueled supply fears and limited the downward pressure on prices.
At least 13 protesters were killed Monday after supporters of Iraqi Shia cleric Muqtada al-Sadr stormed the Republican Palace, the seat of the Iraqi government in Baghdad, according to local media. More than 350 protesters were also injured in the unrest.
By Sibel Morrow
Anadolu Agency
energy@aa.com.tr