Oil prices inched higher on Thursday after U.S. crude and fuel inventories fell more than expected, reinforcing expectations of stable demand in the world’s largest oil consumer.
Brent crude futures were up 25 cents, or 0.37 percent, to $67.09 a barrel at 4:02 GMT, after gaining 1.6 percent in the previous session. Meanwhile, U.S. West Texas Intermediate (WTI) crude futures rose 86 cents, or 1.38 percent, to $63.21 a barrel, after rising 1.4 percent on Wednesday.
Strong U.S. demand supports crude
Oil prices rebounded on signs of strong demand in the U.S., which boosted market sentiment. U.S. crude inventories fell by 6 million barrels last week to 420.7 million, the Energy Information Administration (EIA) said on Wednesday, far exceeding analysts’ expectations for a 1.8 million-barrel draw.
Gasoline stocks declined by 2.7 million barrels, compared with forecasts for a 915,000-barrel drop, reflecting steady driving demand during the summer travel season. The EIA also reported that the four-week average of jet fuel consumption rose to its highest level since 2019.
However, some bearish sentiment persisted as traders kept a close watch on negotiations aimed at ending Russia’s war in Ukraine. Russia warned on Wednesday that efforts to address Ukraine’s security without its involvement were a “road to nowhere,” after reports that U.S. and European military officials have begun discussing potential post-conflict security guarantees for Kyiv.
The International Energy Agency (IEA) said in its August 2025 Oil Market Report that global supply disruptions remain a key driver of price volatility. While non-OPEC output is increasing, the agency warned that geopolitical uncertainty—particularly around sanctions on Russia—is constraining supply growth.
It estimated that continued adherence to restrictions on Russian crude exports by Europe and the U.S. could cut global availability by nearly 1 million barrels per day, adding upward pressure on oil prices.
Russian oil shipments to India continue despite tariff threats
Prolonged efforts to secure peace in Ukraine have kept Western sanctions on Russian oil in place, while the prospect of additional U.S. measures and tariffs against buyers of Russian oil continues to weigh on the market.
Still, Russia has insisted it will maintain crude supplies to willing customers, with diplomats in India saying on Wednesday that shipments to the country would continue despite U.S. warnings.
U.S. President Donald Trump said a 25 percent tariff on Indian goods will take effect on August 27 in response to the country’s purchases of Russian crude. The European Union has also imposed sanctions on Nayara Energy, an Indian private refiner backed by Russia’s Rosneft.
While Indian refiners initially scaled back Russian imports, officials at state-run Indian Oil and Bharat Petroleum have resumed buying for September and October delivery after discounts widened.
