Oil prices extended gains on Thursday, riding higher on growing fuel demand and a bigger-than-expected draw in U.S. crude inventories as production remains hampered in the Gulf of Mexico after two hurricanes.
The market was also supported by a return of appetite for risk assets as concerns eased over a potential default by property developer China Evergrande and its possible fallout on the world’s second-largest economy.
U.S. West Texas Intermediate crude rose 17 cents to $72.40 a barrel, while Brent crude rose 18 cents to $76.37 a barrel.
Both contracts jumped 2.5% on Wednesday after data from the U.S. Energy Information Administration showed U.S. crude stocks fell by 3.5 million barrels to 414 million barrels in the week to Sept. 17
Several OPEC+ countries – including Nigeria, Angola and Kazakhstan – have struggled in recent months to raise output due to years of under-investment or maintenance work delayed by the pandemic.
The dollar, which usually has an inverse relationship with commodities prices including oil, eased slightly from a one-month high, after the U.S. Federal Reserve set the stage for rate hikes next year but left enough breathing room to slow things down if necessary.
The oil market was also supported by a return of appetite for risk assets as concerns eased over a dollar bond interest payment due on Thursday from property developer China Evergrande.