Oil prices rise on US inventory draw, OPEC output hike delay
2024.10.31 04:38
Investing.com — Oil prices rose in Asian trade on Thursday, extending gains from the prior session after an unexpected draw in U.S. inventories- especially a sharp drop in gasoline stockpiles-helped spur some confidence in demand.
Oil markets were also encouraged by a report that the Organization of Petroleum Exporting Countries and allies (OPEC+) will delay a planned increase in production.
Markets took few cues from mixed purchasing managers index data from top oil importer China, which showed business activity just managed to grow in October.
expiring in December rose 0.2% to $72.72 a barrel, while rose 0.2% to $68.80 a barrel by 03:49 ET (07:49 GMT).
US inventories shrink, gasoline stockpiles see big draw
Government data showed on Wednesday that U.S. shrank by 0.5 million barrels (mb) in the past week, compared to expectations for a build of 1.5 mb.
Gasoline inventories in particular saw a large draw, at 2.7 mb, compared to estimates for a 0.6 mb build.
The reading spurred some hopes that oil markets in the world’s biggest fuel consumer were tight, and that fuel demand remained robust.
OPEC+ could delay December production hike- Reuters
Reuters reported on Wednesday that OPEC+ could delay plans to begin increasing production from December by a month or more, amid concerns over weak demand and high supply.
The cartel had delayed plans to increase production by 180,000 barrels per day (bpd) to December from October due to falling oil prices, as concerns over slowing growth in China and easing fears of the Middle East war battered oil markets.
The cartel had also cut its outlook for demand growth for 2024 and 2025, citing weakness in China.
The OPEC+ cut output by about 5.86 million bpd over the past two years to support oil prices, and had flagged plans to begin increasing output from late-2024.
The Reuters report helped lift oil prices on Wednesday, although they were still nursing steep losses from earlier in the week. Brent was also trading just a few dollars above its 2024 lows, which it had hit in September.
