Picture: 123RF/PIX NOO
Picture: 123RF/PIX NOO

London — Oil prices rose on Thursday ahead of inflation and jobs data, rebounding from the previous day’s data that indicated weak demand for fuel during the US driving season.

Brent crude oil futures were up 18c, or 0.25%, at $72.40/bbl by 10.24am GMT, just below a level not seen since May 2019.

US West Texas Intermediate oil futures remained near their highest level since October 2018, rising 11c, or 0.16%, to $70.07/bbl.

“The market is recovering impressively from yesterday’s dismal weekly EIA report; the drop in weekly gasoline [petroleum] demand was particularly disappointing,” said Tamas Varga, analyst at PVM Oil Associates.

“It will interesting to see whether the monthly Opec report due later will confirm last month’s upbeat demand assessment for the second half the year. If it does, as expected, it should support oil prices.”

US inflation data and jobless claims would provide more direction on the health of world’s biggest economy and clues as to whether the Federal Reserve might start tapering stimulus, Varga added.

US crude stockpiles, which include the Strategic Petroleum Reserve (SPR), fell for the 11th straight week as refiners ramped up output, but fuel inventories grew sharply due to weak consumer demand, the Energy Information Administration (EIA) said on Wednesday.

Crude inventories that exclude the SPR fell by 5.2m bbl in the week ended June 4 to 474m bbl, the third consecutive weekly drop. But fuel stocks were up sharply, with product supplied falling to 17.7m bbl/day from 19.1m bbl/day  the week before.

Implied daily petroleum demand fell to 8.48m bbl in the week ended June 4, down from 9.15m bbl the week before, but up from 7.9m bbl a year ago, EIA data showed.

Weighing on prices was India’s fuel demand, which slumped in May to its lowest since August last year, with a second Covid-19 wave stalling mobility and muting economic activity in the world’s third-largest oil consumer.

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