On Wednesday, oil prices rose as the U.S. Energy Information Administration (EIA) and the Organization of the Petroleum Exporting Countries (OPEC) provided optimistic forecasts for global demand, supported by industry data showing a larger-than-expected drop in U.S. crude inventories last week.
As of 0630 GMT, Brent crude futures increased by 50 cents, or 0.6%, to $82.42 per barrel, while U.S. West Texas Intermediate (WTI) crude futures rose by 62 cents, or 0.8%, to $78.52 per barrel.
The EIA revised its 2024 global oil demand growth forecast upwards from 900,000 barrels per day to 1.1 million barrels per day. OPEC maintained its robust demand growth forecast for 2024, primarily driven by expectations for travel and tourism in the second half of the year.
Last week, oil prices dropped by over 2% after OPEC and its allies announced they would start phasing out production cuts from October.
"Crude prices edged higher as OPEC maintained its demand growth forecast," analysts from ANZ Bank stated in a report, adding that oil demand is likely to be driven mainly by China and other emerging economies.
"Despite announcing last week that it will gradually ease some voluntary cuts later this year, its forecast shows the market should absorb the change smoothly."
Meanwhile, market sources, citing data from the American Petroleum Institute, reported that U.S. crude inventories fell by 2.428 million barrels for the week ending June 7, a larger drop than analysts polled by Reuters had expected.
The EIA's data from the U.S. government statistical department is scheduled for release at 10:30 a.m. EDT (1430 GMT) on Wednesday.
Investors are also eyeing the U.S. Consumer Price Index report, set to be released before the market opens on Wednesday, and the Federal Reserve's policy announcement, due later in the day.
