Oil prices surged on Thursday, driven by stronger-than-expected fuel demand in the United States and a weaker US dollar.
Brent crude futures rose by 34 cents (0.5%) to $71.12 per barrel as of 07:45 GMT, marking their highest level since March 3. Meanwhile, US West Texas Intermediate (WTI) crude climbed 42 cents (0.6%) to $67.58 per barrel. The OPEC basket of twelve crudes also saw an increase, reaching $74.12 per barrel on Tuesday from $73.65 the previous day.
The rise follows US government data indicating a higher-than-expected drawdown in distillate inventories, which include diesel and heating oil. Stocks fell by 2.8 million barrels, significantly surpassing the projected drop of 300,000 barrels in a Reuters poll.
In its latest Monthly Oil Market Report, OPEC maintained its forecast for strong global oil demand growth in 2026, projecting a 1.4 million barrels per day (mb/d) increase. The Organization for Economic Co-operation and Development (OECD) is expected to see a modest rise of 0.1 mb/d, while non-OECD demand is forecast to grow by 1.3 mb/d.
Analysts at JPMorgan noted that despite lower air travel volumes, the outlook for US oil demand remains robust, dismissing concerns of a broader market weakness.
A weaker US dollar further supported oil prices, continuing its downward trend since late February.
