Oil prices continued to rise in Asian trading on Thursday, supported by a sharper-than-anticipated drop in U.S. crude inventories, as traders assessed supply dynamics in light of potential developments in Russia-Ukraine diplomacy.
By 21:52 ET (01:52 GMT), Brent crude futures for October delivery were up 0.5% at $67.20 per barrel, while U.S. West Texas Intermediate (WTI) crude rose 0.6% to $63.11 per barrel.
U.S. inventories decline sharply
Crude contracts jumped nearly 2% on Wednesday following the U.S. Energy Information Administration’s (EIA) weekly report, which revealed a much steeper reduction in stockpiles than analysts had expected. U.S. crude inventories dropped by roughly 6 million barrels, well above forecasts of a 1.8 million-barrel decrease.
The decline reflected both strong export activity and continued refinery operations, pointing to tighter supply alongside sustained demand. Gasoline inventories also fell by 2.7 million barrels, surpassing expectations and signaling robust summer driving demand. Refinery utilization edged up to 96.6%, indicating active processing levels.
Market participants interpreted the large inventory draw and strong product demand as evidence that U.S. fuel consumption remains resilient, helping to offset lingering concerns about global economic uncertainty. Earlier this week, the American Petroleum Institute reported a 2.4 million-barrel decrease in U.S. crude stocks for the week ending August 15.
Eyes on potential Russia-Ukraine negotiations
Traders are also closely monitoring possible diplomatic developments between Russia and Ukraine. President Donald Trump stated that he had spoken with Russian President Vladimir Putin after meeting Ukrainian President Volodymyr Zelenskiy and European leaders at the White House earlier in the week.
Trump indicated he was working to facilitate a direct meeting between Moscow and Kyiv, potentially followed by a trilateral summit including the United States. Markets are watching for any signals that such talks could lead to a relaxation of Western sanctions on Russian crude exports.
Russia remains a key global oil supplier, though Western sanctions have limited the flow of Russian crude to international markets since the start of the Ukraine conflict.
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