Global oil prices rose on Wednesday, with global benchmark Brent closing in on $75 a barrel, due to falling stockpiles and a recovery in demand.
In early morning, Brent crude rose 69 cents, or 0.9%, to $74.68 a barrel, having risen 1.6% on Tuesday, CNBC reports.
WTI gained 66 cents, or 0.9%, to $72.78 a barrel, after rising 1.7% on Tuesday.
“The crude demand outlook is very robust as recoveries across the US, Europe and Asia, will have demand return to pre-COVID levels in the second half of next year,” senior market analyst at OANDA Edward Moya told Reuters.
U.S. oil inventories dropped by 8.5 million barrels last week, according to the report.
Executives from major oil traders said on Tuesday they expected prices to remain above $70 a barrel and demand to return to pre-pandemic levels in the second half of 2022.
Vitol Chief Executive Russell Hardy said oil is likely to trade in a range between $70 and $80 a barrel for the rest of this year on the expectation that the Organization of the Petroleum Exporting Countries and its allies (OPEC+) will retain output restraints.
Even the return of Iranian exports if the United States rejoins a nuclear agreement and lifts sanctions on Tehran is unlikely to change the bullish picture, he added.
OPEC+ decided in April to return 2.1 million barrels per day (bpd) of supply to the market from May to July, anticipating rising global demand.