Oil prices rose on Wednesday following a report of declines in US crude inventories and as looming sanctions against Iran raised expectations of tightening supply, while top producer Russia warned of a fragile global crude market.
US West Texas Intermediate (WTI) crude futures were at $69.84 per barrel at 0428 GMT, up 59 cents, or 0.9%, from their last settlement. WTI futures gained 2.5% in the previous session.
Brent crude futures climbed 28 cents, or 0.4%, to $79.34 a barrel.
Brent has climbed for four straight sessions, gaining 2.2% the previous day.
“Oil prices jumped overnight as American Petroleum Institute inventory data showed a large drawdown in inventories,” said William O’Loughlin, investment analyst at Australia’s Rivkin Securities.
US crude stocks fell by 8.6 million barrels in the week to Sept. 7 to 395.9 million barrels, the American Petroleum Institute (API), a private industry group, said on Tuesday.
Official weekly government data will be published by the US Energy Information Administration (EIA) on Wednesday.
Regarding crude oil production, the EIA said on Tuesday it expected US output to rise by 840,000 barrels per day (bpd)between 2018 and 2019 to 11.5 million bpd, lower than arise of 1.02 million bpd to 11.7 million that was previously forecast.
Outside the United States, traders have been focusing on the impact of US sanctions against Iran that will target oil exports from November.
Washington has put pressure on other governments to also cut imports, and many countries and companies are already falling inline and reducing purchases, triggering expectations of a tighter market.