Crude-oil futures on Thursday were edging higher, supported partly by data that showed a sharp drop in U.S. inventories, even as a group of global oil producers made no change to a plan to gradually increase crude output, analysts said.
West Texas Intermediate crude for October delivery
was trading 37 cents, or 0.5%, higher at $68.96 a barrel, following a 0.1% gain on Wednesday for the contract for the U.S. benchmark on the New York Mercantile Exchange.
Meanwhile, global benchmark November Brent crude
added 35 cents, or 0.5%, to $71.94 a barrel, following a 0.1% decline for the global benchmark.
Trading for crude follows a decision on Wednesday by the Organization of the Petroleum Exporting Countries and its allies, a group collectively known as OPEC+, to stick to a plan reached in July to increase oil production by 400,000 barrels a day each month from August.
Some analysts had anticipated that OPEC+ would consider a delay in proceeding with lifting output curbs due the spread of the delta variant of the coronavirus which has threatened to weaken energy demand.
However, Jason Tuvy, senior emerging markets economist at Capital Economics, says that major oil producers were wrestling with a number of factors, including geopolitical factors.
“OPEC+ was dealing with conflicting pressures ahead of the meeting. On the one hand, the group was having to contend with pressure from the Biden administration to raise output more quickly to push down prices,” he wrote in a note dated Thursday.
However, market participants said that investors were taking their cue from price-supportive U.S. supply data reported Wednesday.
The Energy Information Administration reported that U.S. crude inventories fell by 7.2 million barrels for the week ended Aug. 27 following three weeks of declines in a row, more than 60% greater than the average decline of 4.4 million barrels expected by analysts polled by S&P Global Platts.
Likely checking gains for crude oil are comments from Russia which suggested that it is ready to increase production above its set OPEC+ quotas.
The developments with OPEC+ come against the backdrop of Hurricane Ida, which had caused shutdowns of oil and gas refineries in the Gulf Coast region, which could take weeks to restart and is likely to help buttress prices somewhat.
Remnants of Ida delivered record-breaking rainfall and flash floods, leaving at least eight people dead in New York City and New Jersey.