Shafaq News/ Oil prices rose on Wednesday trimming losses from theprevious day, as the focus turned back to potential supply disruptions fromsanctions on Russian tankers, though gains were capped as the market awaitedmore clarity on their impact.
Brent crude futures edged up 11 cents, or 0.1%, to $80.03 a barrel by0515 GMT, after dropping 1.4% in the previous session. U.S. West TexasIntermediate crude climbed 23 cents, or 0.3%, to $77.73 a barrel after a 1.6%decline.
Prices slipped on Tuesday after the U.S. Energy InformationAdministration predicted oil would come under pressure over the next two yearsas supply would outpace demand.
"The dominant driver has been all about the Russian oil sanctionslately, compounded by a streak of stronger U.S. economic data," said YeapJun Rong, market strategist at IG.
"The key question remains on how much Russian supply will be lost inthe global market and whether alternative measures can offset theshortfall," said Yeap, adding that in the near term oil may give up someof its sharp gains from the past week.
The market also found some support on Wednesday from a drop in crudestockpiles in the U.S., the world's biggest oil consumer, reported by theAmerican Petroleum Institute late on Tuesday.
"Oil prices are trading firmer in early morning trading in Asiatoday after API numbers showed that U.S. crude oil inventories fell more thanexpected over the last week," said ING analysts.
The analysts added that while crude oil stocks in the country's flagshipstorage hub Cushing, Oklahoma, increased by 600,000 barrels, inventories werestill historically low. Cushing in the delivery location for WTI futurescontracts.
The API reported U.S. crude oil stocks fell by 2.6 million barrels inthe week ended Jan. 10, according to market sources citing the API figures.They added that gasoline inventories rose by 5.4 million barrels whiledistillate stocks climbed by 4.88 million barrels.
A Reuters poll showed analysts expected U.S. crude oil stockpiles fellby about 1 million barrels in the week to Jan. 10. Stockpile data from theEnergy Information Administration, the statistical arm of the U.S. Departmentof Energy, is due at 10:30 a.m. EST (1530 GMT).
On Tuesday, the EIA trimmed its outlook for global demand in 2025 to104.1 million barrels per day, while expecting supply of oil and liquid fuel toaverage 104.4 million bpd.
It predicted Brent prices would fall 8% to average $74 a barrel in 2025,then fall further to $66 a barrel in 2026, while WTI would average $70 in 2025and fall to $62 next year.
(Reuters)