Oil prices rise slightly on optimistic demand outlook

By Arathy Somasekhar

(Reuters) – Oil prices rose on Wednesday due to optimistic global demand forecasts from the U.S. Energy Information Administration and OPEC.

Brent crude futures rose 11 cents, or 0.1%, to $82.04 a barrel by 0016 GMT, while U.S. West Texas Intermediate (WTI) crude futures gained 18 cents, or 0.2%, to settle at $78.10.

The EIA raised its forecast for global oil demand growth for 2024 to 1.10 million barrels per day, from a previous estimate of 900,000 b/d, while the Organization of the Petroleum Exporting Countries (OPEC ) maintained its 2024 forecast of relatively strong growth in global oil demand, citing expectations. for travel and tourism in the second half of the year.

Prices had fallen more than 2% last week after OPEC and its allies announced they would phase out production cuts starting in October.

“Although it announced last week that it would begin phasing out some of the voluntary cuts later this year, its forecasts suggest this should be readily accepted by the market,” ANZ analysts said in a note to their customers, adding that demand for oil is likely to decline. be driven by China and other emerging economies.

U.S. crude oil inventories fell by 2.428 million barrels in the week ended June 7, according to market sources citing figures from the American Petroleum Institute. Stockpiles are expected to have fallen by just over 1 million barrels last week, according to a preliminary Reuters survey.

Data from the EIA, the U.S. government’s statistical arm, is expected later Wednesday.

Investors were also eagerly awaiting the Consumer Price Index report, which will be released before the bell on Wednesday, as well as the U.S. central bank’s policy announcement, expected later the same day.

The monthly US employment report released on Friday was better than expected. Markets have lowered their expectations for an initial Federal Reserve rate cut in September, now pricing in a probability of around 50%, according to the CME’s FedWatch tool.

China’s producer and consumer price inflation figures are also expected to be released today.

(Reporting by Arathy Somasekhar in Houston; Editing by Shri Navaratnam)

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