WionDrive News Desk 
Oil prices gained ground on Wednesday, buoyed by upbeat forecasts for global oil demand from influential energy agencies and industry data pointing to a more significant drawdown in U.S. crude stockpiles than anticipated. The positive sentiment surrounding demand prospects outweighed concerns over the recent decision by OPEC and its allies to gradually phase out output cuts.
Brent crude futures, the global benchmark, rose by 50 cents, or 0.6%, to USD 82.42 a barrel, while U.S. West Texas Intermediate (WTI) crude futures climbed 62 cents, or 0.8%, to USD 78.52 at the time of writing.
The U.S. Energy Information Administration (EIA) raised its 2024 world oil demand growth forecast to 1.10 million barrels per day (bpd), up from its previous estimate of 900,000 bpd. Similarly, the Organization of the Petroleum Exporting Countries (OPEC) maintained its relatively strong growth projection for global oil demand in 2024, citing expectations for increased travel and tourism activities in the second half of the year.
These optimistic demand outlooks from influential energy agencies reinforced the bullish sentiment in the oil market, despite OPEC and its allies announcing plans to gradually phase out output cuts starting in October.
Further supporting the upward momentum in oil prices was industry data from the American Petroleum Institute (API) that revealed a larger-than-expected decline in U.S. crude oil inventories for the week ended June 7. According to market sources citing API figures, U.S. crude stocks fell by 2.428 million barrels, surpassing analysts’ forecasts.
Analysts at ANZ noted that crude oil prices edged higher as OPEC maintained its forecasts for strengthening demand, suggesting that the demand for oil is likely to be driven by China and other emerging economies. They added that despite announcing plans to phase out voluntary cuts later this year, OPEC’s forecasts indicate that the market should easily absorb the additional supply.
Investors are also keeping a close eye on the upcoming U.S. Consumer Price Index report and the Federal Reserve’s policy announcement, both scheduled for release on Wednesday. A dovish stance from the Fed could potentially stimulate economic growth and boost oil demand, further supporting the upside momentum in oil prices.
However, concerns over a global economic slowdown continue to linger, potentially weighing on oil demand in the long term. In China, the world’s largest crude importer, consumer inflation remained steady in May, while producer price declines eased, indicating that Beijing may need to implement additional measures to bolster feeble domestic demand and support the uneven economic recovery.
