Oil prices climb on signs of strong fuel demand recovery

Oil prices climb on signs of strong fuel demand recovery

Oil prices rose for a second session on Wednesday on signs of strong fuel demand in western economies, while the prospect of Iranian supplies returning faded as the U.S. secretary of state said sanctions against Tehran were unlikely to be lifted.

Brent crude futures were up 32 cents, or 0.4%, at $72.54 a barrel at 0640 GMT, having earlier touched $72.83, the highest since May 20, 2019. Brent rose 1% on Tuesday.

U.S. West Texas Intermediate (WTI) crude futures climbed 31 cents, or 0.4%, to $70.36 a barrel, after rising to as high as $70.62, highest since Oct. 17, 2018. WTI prices climbed 1.2% on Tuesday.

On Tuesday, the U.S. Energy Information Administration forecast fuel consumption growth this year in the United States, the world’s biggest oil user, would be 1.49 million barrels per day (bpd), up from a previous forecast of 1.39 million bpd.

The American Petroleum Institute reported crude stocks fell by 2.1 million barrels in the week ended June 4, two market sources said, citing the data.

Stockpile data from the U.S. Energy Information Administration is due on Wednesday at 14:30 GMT, Reuters reported.

Price gains had been capped in recent weeks as oil investors had been assuming that sanctions against Iranian exports would be lifted and oil supply would increase this year as Iran’s talks with western powers on a nuclear deal progressed.

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