TOKYO (Reuters) – Oil prices extended gains from the previous session on Thursday on signs of stronger demand in the U.S. where data showed slower inflation than markets expected, strengthening the argument for an interest rate cut which could result in even stronger demand.
Brent futures rose 42 cents, or 0.5%, to $83.17 a barrel, while U.S. West Texas Intermediate crude (WTI) gained 43 cents, or 0.6%, to $79.06 at 0032 GMT.
U.S. consumer prices rose less than expected in April in a boost to financial market expectations for a September rate cut by the Federal Reserve, which could temper dollar strength and make oil more affordable for holders of other currencies.
U.S. crude oil, gasoline and distillate inventories fell, reflecting a rise in both refining activity and fuel demand, showed data from the Energy Information Administration (EIA).
Crude inventories fell 2.5 million barrels to 457 million barrels in the week ended May 10, the EIA said, versus the 543,000 barrel consensus analyst forecast in a Reuters poll.
Signs of slowing inflation and stronger demand were supporting prices, ANZ Research said in a client note, as is geopolitical risk which it said remains elevated.
In the Middle East, Israeli troops battled Hamas militants across Gaza, including Rafah which had been a civilian refuge.
Oil Prices Rise pose challenges for consumers and businesses globally. Higher fuel costs impact transportation and production. Moreover, governments and industries must navigate this economic landscape to mitigate adverse effects.
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