Oil prices rise as tighter supply bets offset rate hike jitters
Investing.com-- Oil prices rose slightly in Asian trade on Wednesday, extending a rebound from the prior session as the prospect of tighter supplies helped markets look past concerns over rising interest rates and their impact on the economy.
Industry data showed a drop in U.S. fuel and distillate inventories, indicating that fuel consumption in the world’s largest economy remained consistent, despite the end of the travel-heavy summer season.
The data came on the heels of a fuel export ban in Russia, which is set to tighten fuel supplies in large swathes of Europe and Asia. Recent crude production cuts by Saudi Arabia and Russia, which are set to continue until the end of the year, also pointed to substantially tighter oil supplies in the coming months.
The prospect of tighter supplies helped support oil prices, even as markets grew increasingly concerned over future demand amid signals of higher interest rates from the Federal Reserve.
Strength in the dollar — which surged to a 10-month high this week- limited any major gains in oil prices.
Brent oil futures rose 0.2% to $92.68 a barrel, while West Texas Intermediate crude futures rose 0.3% to $90.69 a barrel by 20:36 ET (00:36 GMT).
Data from the American Petroleum Institute showed on late-Tuesday that U.S. crude stockpiles grew nearly 1.6 million barrels (mb) in the week to September 22, rising slightly after a 5.3 mb tumble in the prior week.
Gasoline and distillate inventories fell 0.07 mb and 1.7 mb, respectively, indicating that fuel demand in the country remained steady.
The API data acts as a precursor to official inventory data, which is due later on Wednesday. But the reading still painted a tight picture of U.S. crude markets.
Analysts are expecting
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