Oil prices rose modestly on Wednesday, buoyed by data showing a larger-than-expected draw on U.S. crude inventories last week.
Brent crude futures for August delivery gained 0.2 percent to $82.09 per barrel, while West Texas Intermediate (WTI) crude futures rose 0.3 percent to $77.79 per barrel as of 00:53 GMT.
The gains came after the American Petroleum Institute (API) reported late Tuesday that U.S. oil inventories fell by 2.4 million barrels in the week to June 7. This exceeded the expected draw of 1.8 million barrels and reversed the previous week’s 4 million barrel build.
The API data typically foreshadows a similar reading from the official U.S. Energy Information Administration (EIA) report due later Wednesday.
Read more: Oil prices dip ahead of key Fed meeting, U.S. inflation data release
Caution ahead of Fed meeting and CPI data release
However, the upside for oil prices was capped by investor caution ahead of the conclusion of the Federal Reserve’s two-day policy meeting later in the day, as well as the release of key U.S. consumer price index (CPI) data.
While the Fed is widely expected to hold interest rates steady, any commentary on the future path of monetary policy will be closely watched. Additionally, the CPI report could provide insights into the persistence of inflationary pressures, which could influence the Fed’s future rate hike decisions.
Recent signs of strength in the U.S. labor market and sticky inflation have raised concerns that the Fed may keep rates higher for longer, a scenario that could weigh on global economic growth and oil demand.
OPEC maintains demand outlook, IEA report awaited
In its latest monthly report, OPEC maintained its outlook for strong global oil demand in 2024, though investors are also awaiting the release of the International Energy Agency’s report, which has previously taken a more conservative view on demand.
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