Oil prices on track for near two-year high on rising demand outlooks

Oil prices jumped on Wednesday, putting Brent on track for its highest close in almost two years on signs of a speedy economic recovery and upbeat forecasts for energy demand.

Brent futures rose $1.12, or 1.6 per cent, to $69.67 a barrel by 10:44 am EDT (8.14 pm IST), while US West Texas Intermediate crude rose $1.10, or 1.7 per cent, to $66.38.

Gains soon after the release of the weekly inventory data put WTI on course for its highest close since October 29, 2018 and Brent for its highest close since May 28, 2019.

Those price gains came despite a smaller than expected US weekly crude inventory draw and a surprise increase in the gasoline stockpile.

“At this time of year we should be burning through a lot of gasoline and that’s not what this report is showing,” Bob Yawger, director of energy futures at Mizuho, said, noting he did not “think there’s a skew to the data due to the Colonial (pipeline) outage.” The US Energy Information Administration (EIA) said crude inventories declined 0.4 million barrels last week versus an expected 2.8 million barrel draw.