Crude oil prices firmed Wednesday, remaining at the highest levels in more than two years, benefiting from expectations of a continuously improving fuel demand outlook.
By 9:25 AM ET (1425 GMT), U.S. crude was up 0.8% at $68.24 a barrel, after settling the previous session at its highest level since October 2018. Brent was up 0.8% at $70.84, after closing Tuesday above $70 for the first time since 2019.
U.S. Gasoline RBOB Futures were up 0.7% at $2.1860 a gallon.
The Organization of the Petroleum Exporting Countries and other top producers, including Russia, a grouping known as OPEC+, agreed late Tuesday to keep to their plan to gradually ease supply curbs through July.
The OPEC+ meeting took only 20 minutes, the shortest in the group's history, suggesting overwhelming confidence in the market's recovery.
“The market appears focused on the more constructive outlook for later this year, with OPEC+ of the view that the market will see significant stock drawdowns between September and the end of the year,” said analysts at ING, in a note.
Adding to the market’s confidence, the International Energy Agency said it expected global oil demand to return to pre-pandemic levels in a year, which would be quicker than many in the market are expecting.
Another factor buoying the market was the suggestion that talks to revive a 2015 nuclear accord with Iran have hit a snag, with an official from the Persian Gulf country saying a deal is now expected to be finalized in August.
This contrasts with the positive noises that were commonplace at the end of last week, and even if the individual is correct it would rule out an immediate increase in global supply.
Iran and global powers have been negotiating since April to work out steps needed to revive the 2015 nuclear accord, which could result in the Persian Gulf country restarting its crude exports.
Further on the supply side, U.S. crude oil inventories data from the American Petroleum Institute are due later in the session, with the official numbers from the U.S. Energy Information Administration due on Thursday, a day later than usual following the Memorial Day holiday at the start of the week. Investing.com