Oil prices closed slightly higher on Thursday helped by a drop in US fuel stocks as the market overlooked oversupply concerns and demand worries caused by a firmer Dollar.
Brent crude futures settled 28 cents, or 0.4 percent higher at $72.56 a barrel while the US West Texas Intermediate (WTI) crude futures rose 27 cents, or 0.4 percent at $68.70.
The US Energy Information Administration (EIA) reported an inventory build of 2.1 million barrels for the week to November 8. In fuels, however, inventories fell.
US gasoline (petrol) stocks fell by 4.4 million barrels last week, indicating a good demand level.
The crude oil inventory change compared with a build of the same size for the previous week, which pressured oil prices at the time.
A day earlier, the American Petroleum Institute (API) reported an unexpected but modest draw in crude oil inventories to 777,000 barrels for the week of November 8.
The API also estimated a draw in gasoline inventories and a build in middle distillates.
The market remains pressured by the weight of lower demand expectations coupled with ample supply indications.
The Organisation of the Petroleum Exporting Countries (OPEC) and the International Energy Agency (IEA) reviewed their demand outlook and signalled that they expect a well-supplied market this year and next.
The IEA forecasts global oil supply will exceed demand in 2025 even if cuts remain in place from OPEC+, which includes OPEC and allies such as Russia, as rising production from the US and other outside producers outpaces sluggish demand.
The Paris-based agency raised its 2024 demand growth forecast by 60,000 barrels per day to 920,000 barrels per day and left its 2025 oil demand growth forecast little changed at 990,000 barrels per day.
OPEC, meanwhile, revised down its oil demand forecast for this year, to 1.82 million barrels daily from 1.93 million barrels daily in the previous edition of the Monthly Oil Market Report. Total world oil demand is anticipated to reach 104.0 million barrels per day in 2024, bolstered by strong transportation fuel demand and ongoing healthy economic growth.
Pressure remains from the US Dollar, which makes Dollar-denominated commodities like crude oil more expensive for holders of other currencies, which can reduce demand.
The Dollar surged to a one-year high and headed for a fifth-straight daily gain fuelled by higher yields and President-elect Donald Trump’s election victory in the US.