Oil prices rise as US oil and fuel inventories dwindle

By Laila Kearney

NEW YORK (Reuters) – A drop in U.S. oil inventories caused oil prices to rebound on Wednesday after several days of declines, while expectations of a forthcoming ceasefire agreement in the Middle East hampered for prices to continue to rise.

Brent crude futures for September rose 46 cents to $81.47 a barrel by 0020 GMT. U.S. West Texas Intermediate crude oil for September rose 42 cents to $77.38 per barrel.

US crude oil, gasoline and distillate inventories fell last week, according to market sources citing the American Petroleum Institute (API), a trade organization.

Benchmarks have increased accordingly. WTI had lost 7% in the previous four sessions and Brent fell almost 5% in the previous three.

API figures showed that oil inventories fell by 3.9 million barrels in the week ending July 19, the sources said, speaking on condition of anonymity. Gasoline stocks fell by 2.8 million barrels and distillates lost 1.5 million barrels.

This would be the first time U.S. crude oil inventories have fallen for four consecutive weeks since September 2023.

Official government data on oil inventories is expected to be released on Wednesday.

Oil prices fell to a six-week low on Tuesday, with Brent closing at its lowest level since June 9 in ceasefire negotiations between Israel and Hamas, in a plan outlined by the US president , Joe Biden, in May and mediated by Egypt and Qatar.

Prices also suffered from continued concerns that the economic slowdown in China, which is the world’s largest importer of crude oil, would weaken global oil demand.

(Reporting by Laila Kearney in New York; Editing by Christopher Cushing)