Oil prices rise on signs on US inventory draw, supply risks
2024.08.27 21:21
Investing.com– Oil prices rose in Asian trade on Wednesday, buoyed by industry data pointing to another outsized draw in U.S. inventories, while tensions in the Middle East and supply disruptions in Libya also offered support.
Crude prices were hit with losses in the prior session amid some profit-taking after a strong rebound over the past week. Lingering concerns over an economic slowdown also weighed.
expiring in October rose 0.5% to $79.92 a barrel, while rose 0.5% to $75.92 a barrel by 20:25 ET (00:25 GMT).
US inventories shrink more than expected- API
Data from the showed U.S. oil inventories saw a draw of 3.4 million barrels in the week to August 23, more than expectations for a draw of 3 mb.
The data also showed sustained draws in gasoline and distillate stockpiles.
The API data usually heralds a similar reading from , which is due later on Wednesday.
U.S. inventories have fallen for eight of the past nine weeks, driving hopes that demand in the world’s biggest fuel consumer remains strong despite recent signs of cooling in the economy.
But with September comes the end of the travel-heavy summer season, which could see some cooling in U.S. fuel demand.
Concerns over a U.S. economic slowdown also remained in play, as did expectations that the Federal Reserve will begin cutting interest rates from September.
Middle East, Libya risks buoy crude
Geopolitical risks also saw traders attaching a greater risk premium to oil.
Libya in particular was a key point of focus for markets, after the country’s eastern administration reportedly suspended all oil production amid a growing row over the leadership of the Central Bank of Libya.
The central bank is the only internationally recognized depository for Libya’s oil exports, and is at the center of a brewing conflict between the western and eastern factions.
Libya produced roughly 1.2 million barrels per day of crude in July, with any output disruptions heralding tighter global markets.
In the Middle East, tensions between Israel and Hamas showed little signs of abating after peace talks over the weekend yielded no agreement. Israel and Hezbollah also attacked each other over the past few days.
