Oil prices rose more than 2 percent on Wednesday, recovering some of the previous session's losses, as a drop in U.S. crude inventories and concerns about disruptions to U.S. production outweighed worries about weak global demand.
According to market sources, citing data from the American Petroleum Institute for the latest week on Tuesday, US crude inventories fell by 2.793 million barrels, fuel inventories fell by 513,000 barrels, and distillate inventories rose by 191,000 barrels.
Price movements
Brent crude futures rose $1.41, or 2.04 percent, to $70.60 a barrel by 10:48 GMT.
U.S. West Texas Intermediate (WTI) crude futures rose $1.79, or 2.7 percent, to $67.54 a barrel.
Benchmark crude prices fell on Tuesday, with Brent falling below $70 a barrel to its lowest since December 2021 and U.S. crude falling to its lowest since May 2023, after OPEC cut its demand growth forecast for 2024 for the second time.
The market rebounded automatically as Tuesday's drop was so big, said Yuki Takashima, an economist at Nomura Securities, adding that concerns about supply disruptions due to Typhoon Francine also provided support.
The US Environmental Protection Agency said Tuesday that about 24 percent of crude oil production and 26 percent of natural gas production in the Gulf of Mexico were shut down due to the storm.
OPEC said in a monthly report on Tuesday that global oil demand will rise by 2.03 million barrels per day in 2024, down from last month's growth forecast of 2.11 million barrels per day.
OPEC also lowered its estimate for global oil demand growth in 2025 to 1.74 million barrels per day from 1.78 million barrels per day.
