Oil prices experienced an upward surge on Thursday, buoyed by declining U.S. crude inventories alongside a rise in refinery intake and a year-on-year increase in Chinese imports last month. These factors supported higher demand expectations for the world’s two largest crude consuming nations.
Brent crude futures for July climbed by 31 cents, or 0.4%, reaching $83.89 a barrel by 0533 GMT, while U.S. West Texas Intermediate crude for June saw an increase of 39 cents, or 0.5%, reaching $79.38 per barrel.
Tina Teng, an independent market analyst, attributed the rise in oil markets to a larger-than-expected draw in U.S. inventory data and improved China’s trade balance data. Teng noted that crude prices may continue to track economic factors in the foreseeable future.
The Energy Information Administration reported a decrease in crude inventories in the U.S., the world’s largest oil user, by 1.4 million barrels to 459.5 million barrels last week, surpassing analysts’ expectations for a 1.1 million-barrel draw. This decline was accompanied by an increase in refinery activity by 307,000 barrels per day (bpd) during the period.
However, the rise in refinery activity resulted in an increase in gasoline stocks by over 900,000 barrels to 228 million barrels, while distillate stockpiles, including diesel and heating oil, rose by 600,000 barrels to 116.4 million barrels.
The combination of falling U.S. inventories and strong demand indicators from China contributed to the positive momentum in oil markets, signaling potential for continued price appreciation in the near term. As market participants monitor supply dynamics and economic trends, the outlook for oil prices remains influenced by evolving global demand patterns and geopolitical developments.
