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Oil costs increase on optimism over strong United States fuel demand

Oil prices increased on Thursday, extending the previous day's rally, driven by optimism over U.S. fuel demand following an unanticipated drop in crude and gas stocks, while reports that OPEC+ may postpone a. scheduled output increase offered support.

Brent crude futures gained 47 cents, or 0.65%,. to $73.02 a barrel by 0505 GMT. U.S. West Texas Intermediate. crude futures, which are set to expire later in the day,. climbed 43 cents, or 0.63%, to $69.04 per barrel.

Both contracts rose more than 2% on Wednesday, after falling. more than 6% earlier in the week on the reduced risk of a broader. Middle East dispute.

U.S. gasoline stockpiles fell suddenly in the week. ending Oct. 25 to a two-year low on strengthened demand, the. Energy Information Administration stated, while crude stocks. likewise published a surprise drawdown as imports slipped.

Nine analysts surveyed had actually anticipated a boost in. gasoline and unrefined stocks.

The surprise decline in U.S. gas stockpiles supplied a. purchasing chance as need appeared stronger than. anticipated, stated Toshitaka Tazawa, an analyst at Fujitomi. Securities.

Expectations of a prospective delay in the OPEC+ production. increase were also helpful ... If they do delay, WTI could. recuperate to the $70 level, he said.

Reuters reported OPEC+, which groups the Organization of the. Petroleum Exporting Countries and allies such as Russia, could. postpone a prepared oil production increase in December by a month. or more since of concern over soft oil need and increasing. supply.

The group is set up to raise output by 180,000 barrels. daily (bpd) in December. It had currently postponed the boost. from October since of falling rates.

A choice to delay the boost could come as early as. next week, 2 OPEC+ sources told Reuters.

OPEC+ is scheduled to fulfill on Dec. 1 to choose its next. policy actions.

Manufacturing activity in China, the world's greatest oil. importer, broadened in October for the very first time in 6 months,. suggesting that stimulus steps are having a result.

Markets are waiting for the results of the U.S. presidential. election on Nov. 5 as well as more details of China's. economic stimulus. Reuters reported that China could authorize the. issuance of over 10 trillion yuan ($ 1.4 trillion) in debt over. the next few years on the last day of its Nov. 4-8 parliamentary. meeting.

In the Middle East, Lebanon's prime minister expressed hope. on Wednesday that a ceasefire deal with Israel would be. announced within days as Israel's public broadcaster released. what it said was a draft contract offering an initial. 60-day truce.

The push for a ceasefire for Lebanon is happening. along with a comparable diplomatic drive to end hostilities in Gaza.

But the marketplace impact is most likely to be silenced.

The majority of the Middle East geopolitical risk was stripped. out of the oil cost after Israel's action to Iran over the. weekend, IG market analyst Tony Sycamore said.

Iran stated that Israeli strikes on Saturday, in. retaliation for Iran's Oct. 1 attack on Israel, caused only. minimal damage.

(source: Reuters)