Oil prices edged up on Thursday, extending the previous session’s gains as a larger-than-expected decline in U.S. crude stocks signaled strong demand. As regional tensions cooled, investors remained cautious about the Iran-Israel ceasefire and stability in the Middle East.
As of 4:44 GMT, Brent crude futures rose 22 cents, or 0.33 percent, to $67.9 a barrel, while U.S. West Texas Intermediate (WTI) crude gained 24 cents, or 0.37 percent, to $65.16 a barrel. Both benchmarks climbed nearly 1 percent on Wednesday, recovering some losses from earlier this week after data showed resilient U.S. demand.
U.S. inventories mark larger-than-expected decline
Investor confidence remains on edge as they seek more clarity on the status of the Iran-Israel ceasefire. However, market attention is now shifting to OPEC+ production levels and their impact on oil prices. Analysts noted that with the de-escalation of conflict between Iran and Israel, the market’s focus had returned to fundamentals, and pointed to data showing U.S. crude oil inventories falling for a fifth consecutive week.
U.S. crude oil and fuel inventories fell in the week to June 20 as refining activity and demand rose, the Energy Information Administration (EIA) said on Wednesday. Crude inventories dipped 5.8 million barrels, the EIA said, exceeding analysts’ expectations for a 797,000-barrel decline. Meanwhile, gasoline stocks unexpectedly fell by 2.1 million barrels, compared with forecasts for a 381,000-barrel build.
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OPEC+ to advance planned oil output increases
On Saturday, Igor Sechin, head of Russia’s largest oil producer Rosneft, stated that OPEC+, which includes the Organization of the Petroleum Exporting Countries and allies such as Russia, might advance its planned oil output increases by about a year from the original timeline. A rise in supply may place added pressure on oil prices as geopolitical tensions ease in the Middle East.
At the same time, U.S. President Donald Trump welcomed the rapid resolution of the conflict between Iran and Israel, adding that Washington is likely to push for a pledge from Tehran to abandon its nuclear ambitions during upcoming talks with Iranian officials.
Trump also emphasized that the U.S. continues to uphold its maximum pressure campaign on Iran, including restrictions on its oil exports, but suggested there may be some flexibility in enforcement to aid Iran’s reconstruction efforts.
