Oil rises on renewed gasoline demand, weak dollar

Sticker reads crude oil on the facet of a storage tank within the Permian Basin in Mentone, Loving County, Texas, U.S. November 22, 2019. REUTERS/Angus Mordant

NEW YORK, Aug 10 (Reuters) – Oil costs rose on Wednesday, rebounding from losses early within the session, helped by encouraging figures on U.S. gasoline demand and as lower-than-expected U.S. inflation information drove traders into riskier property.

Brent crude futures settled up $1.09, or 1.1%, to $97.40 a barrel, whereas U.S. West Texas Intermediate crude futures gained $1.43, or 1.6%, to $91.93.

U.S. crude oil shares rose by 5.5 million barrels in the newest week, the U.S. Vitality Data Administration mentioned, greater than the anticipated improve of 73,000 barrels.

Nevertheless, U.S. gasoline shares fell sharply as implied demand rose after weeks of lackluster exercise throughout what is meant to be peak summer time driving season.

“Everybody has been very a lot centered on potential demand destruction, so seeing implied demand displaying an outsized rebound for final week has in all probability given some consolation to these actually involved about that,” mentioned Matt Smith, lead oil analyst for the Americas at Kpler.

Gasoline product provided rose in the newest week to 9.1 million barrels per day, although that determine nonetheless reveals demand down 6% over the previous 4 weeks in contrast with the year-ago interval.

U.S. oil refiners and pipeline operators count on sturdy power consumption for the second half of 2022, a Reuters assessment of firm earnings calls confirmed. learn extra

U.S. client costs have been unchanged in July on account of a pointy drop in the price of gasoline, delivering the primary notable signal of aid for People who’ve watched inflation climb over the previous two years. learn extra

That contributed to an increase in threat property together with equities, whereas the U.S. greenback fell greater than 1% towards a basket of currencies . With most worldwide oil gross sales transacted in {dollars}, a weakening buck is supportive for oil. Nevertheless, crude’s positive factors have been modest.

“There may be not loads of bullish power available in the market. With this sort of greenback weak point, you have to be seeing a $2-$3 improve in crude and also you’re not seeing that,” mentioned Eli Tesfaye, senior market strategist at RJO Futures in Chicago.

The market earlier slipped as flows on the Russia-to-Europe Druzhba pipeline resumed.

Russian state oil pipeline monopoly Transneft (TRNF_p.MM) restarted oil flows by way of the southern leg of the Druzhba oil pipeline. Ukraine had suspended Russian oil pipeline flows to components of central Europe since early this month as a result of Western sanctions prevented it from receiving transit charges from Moscow, Transneft mentioned on Tuesday. learn extra

Reporting by David Gaffen in New York and Rowena Edwards in London; Modifying by David Gregorio and Lisa Shumaker

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