Crude oil rises on OPEC demand forecast

Crude oil prices trimmed higher Thursday, supported by continued confidence by a group of top producers in growing oil demand in the second half of the year.

By 9:35 AM ET (1335 GMT), U.S. crude was higher 0.8% at $70.53 a barrel, extending to the firm after finishing over $70 earlier this week for the first time after October 2018. Brent was higher 0.9% at $72.84, near a two-year high.

U.S. Gasoline RBOB Futures were higher 1% at $2.2238 a gallon.

The Organization of the Petroleum Exporting Countries held to its estimate a strong recovery in global oil demand in the second half of 2021, driven by the United States and China.

In its monthly report, published earlier Thursday, the group stated demand would increase by 6.6% or 5.95 million barrels per day this year, maintained for a second continuous month, notwithstanding a slower-than-expected recovery in the first half of this year.

Global economic improvement has been postponed due to the resurgence of coronavirus infections and renewed lockdowns in essential economies, including the Eurozone, Japan, and India, OPEC stated in its monthly report.

The overall market had given vulnerability earlier Thursday, before the announcement of the OPEC report, following the publicity of disappointing U.S. gasoline inventory numbers Wednesday.

Crude oil supply data from the U.S. Energy Information Administration revealed a draw, for the third continuous week, of just over 5 million barrels. However, gasoline inventories improved after April 2020, climbing by more than 7 million barrels for a second weekly gain.

This points to weaker-than-expected fuel demand at the origin of the U.S. summer, the country’s peak season for motoring.

Also pressing was the news that fuel demand in India, the world’s third-largest oil customer, sank in May to its weakest after August last year, as a second coronavirus wave muted economic activity.