The Oil Market Shrugs Off A Spike in U.S. Inventories And Edges Up

Oil prices rose in early Asian trade on Thursday as the market brushed off a massive increase in U.S. oil inventories and the International Energy Agency upgraded its demand forecast.

By 01:31 GMT, Brent crude prices increased by 26 cents to $85.64 per barrel, whereas U.S. West Texas Intermediate (WTI) crude futures advanced by 34 cents to $78.

The Energy Information Administration (EIA) said that U.S. crude oil inventories increased by 16.3 million barrels last week to reach 471.4 million barrels, the largest level since June 2021. The larger-than-anticipated increase was mostly attributable to a data adjustment, which analysts said mitigated the impact on oil prices. [EIA/S]

The International Energy Agency (IEA) estimated that oil demand will climb by 2 million barrels per day (bpd) in 2023, an increase of 100,000 bpd from last month's estimate, reaching a record 101.9 million bpd, with China accounting for 900,000 bpd of the increase.

Upon easing COVID-19 restrictions, China will account for over half of 2023 oil demand increase, according to the IEA.

The U.S. currency, which normally moves inversely with crude prices, also helped oil.