Oil firmed on Thursday, edging up from multi-month lows, due to a possible delay to output increases by OPEC+ producers and a decline in U.S. inventories, though gains were capped by persistent demand concerns.
Figures from the American Petroleum Institute (API) showed U.S. crude oil inventories fell by 7.431 million barrels last week, far exceeding the 1 million barrel draw expected by analysts in a Reuters poll.
“There is a pause of breath and light reprieve for oil prices,” said PVM analyst John Evans, citing the API report’s findings.
Brent crude for November was up 66 cents, or 0.9%, to $73.36 a barrel at 1300 GMT after touching its lowest since December on Wednesday. U.S. West Texas Intermediate crude for October was up 64 cents, or 0.9%, at $69.84.
Further support came from discussions between the Organization of the Petroleum Exporting Countries (OPEC) and allies led by Russia, known collectively as OPEC+, about delaying output increases due to start in October, sources told Reuters on Wednesday.
Any decision by OPEC+ might be taken negatively by the market, HSBC said in a report.
“Raising production would tip the market into a meaningful surplus from Q1 2025 onwards. On the other hand, holding off may be interpreted as a belated admission by OPEC that oil demand is weak.”
OPEC+ had been ready to proceed with an output increase of 180,000 barrels per day (bpd) in October, part of plans for a gradual unwinding of its most recent cuts of 2.2 million bpd.
However, continued soft demand in China and the potential end of a dispute halting Libyan oil exports has pushed the group to reconsider.
Official U.S. oil stocks data from the Energy Information Administration (EIA) is due at 1430 GMT.
Financial markets were also awaiting further U.S. macroeconomic indicators due later on Thursday and Friday, including jobs data.
