Oil prices edged higher on Wednesday, buoyed by positive demand indicators in the United States, the world’s largest oil consumer.
This suggests a potential tightening of supply in US markets as the summer driving season approaches.
Benchmark Brent crude rose slightly to $88.55 per barrel, while West Texas Intermediate (WTI) reached $83.46 per barrel.
This uptick follows data released by the American Petroleum Institute (API) on Tuesday, showing a surprise drop of 3.23 million barrels in US crude oil inventories.
Analysts had predicted an increase of 1.8 million barrels.
The lower-than-expected stockpile levels point towards increased demand in the US, especially with the summer vacation season approaching.
Confirmation of this trend by the official Energy Information Administration (EIA) data later on Wednesday could trigger further price hikes.
However, geopolitical tensions in the Middle East continue to cast a shadow on the oil market.
The ongoing Israeli-Palestinian conflict remains unresolved, despite calls for a ceasefire.
Israel’s airstrikes in the Gaza Strip raise concerns about potential disruptions to oil supplies from the region.
This situation underscores the complex interplay between economic factors and geopolitical risks that influence oil prices.
While US demand appears robust, ongoing conflict in the Middle East injects uncertainty into the market.
