Oil prices rose on Wednesday, recovering from six-month lows hit the previous day, as a larger-than-expected drop in U.S. oil and gasoline stocks reminded investors that demand remains firm if overshadowed by the prospect of a global recession.
Brent crude futures rose 56 cents, or 0.6 percent, to $92.90 a barrel. West Texas Intermediate (WTI) crude futures climbed 62 cents, or 0.7 percent, to $87.15 a barrel, according to Reuters.
The contracts slumped about 3 percent on Tuesday as weak U.S. housing starts data spurred concerns about a potential global recession.
U.S. crude and fuel stocks fell in the latest week, according to market sources citing American Petroleum Institute (API) figures on Tuesday.
Crude stocks fell by about 440,000 barrels for the week ended Aug. 12. Gasoline inventories fell by about 4.5 million barrels, while distillate stocks fell by about 759,000 barrels, according to the sources.
The EU and the United States said on Tuesday they were studying Iran’s response to what the EU has called its “final” proposal to save the 2015 nuclear deal. Iran responded to the proposal late Monday. But neither side provided any details.
Oil prices were also hit by weak economic data from the United States and China. Meanwhile, Barclays lowered its Brent price forecasts on Tuesday by $8 per barrel for 2022 and 2023, as it expects a large surplus of crude oil over the near term due to “resilient” Russian supplies.