LONDON : Brent oil futures held steady on Thursday, bolstered by signs of stronger demand in the US after slower than expected inflation in April and lower oil stocks in the past week.
Brent crude futures fell 25 cents, or 0.3%, to $82.50 a barrel by 0951 GMT. US West Texas Intermediate crude (WTI) shed 26 cents, or 0.33%, to $78.37.
Brent had touched an intra-day low of $81.05 on Wednesday - the lowest the front-month futures contract has traded since Feb. 26 - but recovered to about 0.5% higher on the day.
US crude oil, gasoline and distillate inventories fell, reflecting a rise in both refining activity and fuel demand, Energy Information Administration (EIA) data showed.
Crude inventories fell by 2.5 million barrels to 457 million barrels in the week ended May 10, the EIA said, versus the 543,000 barrel consensus analyst forecast in a Reuters poll “With refinery runs increasing by 1.9% there suddenly became a whiff of demand.
This then caused the handbrake turn in price fortunes and the verve shown in earlier selling was called and raised by buying that saw all losses erased,” said PVM analyst John Evans.
Signs of slowing inflation and stronger demand were supporting prices, ANZ Research said in a client note, as is elevated geopolitical risk.
US consumer prices rose less than expected in April in a boost to financial market expectations for a September cut to interest rates by the Federal Reserve, which could temper dollar strength and make oil more affordable for holders of other currencies.
“A more tamed read for US April inflation and a far weaker than expected read in US retail sales seem to offer room for the Fed to consider earlier rate cuts, with market expectations leaning more firmly for policy easing to kickstart in September,” said IG market strategist Yeap Jun Rong.
In the Middle East, Israeli troops battled Hamas militants across Gaza, including Rafah, which had been a civilian refuge.
Ceasefire talks mediated by Qatar and Egypt are at a stalemate, with Hamas demanding an end to attacks and Israel refusing until the group is annihilated.
— Reuters
US crude oil, gasoline and distillate inventories fell, reflecting a rise in both refining activity and fuel demand, Energy Information Administration (EIA) data showed
Oman Observer is now on the WhatsApp channel. Click here
