Oil prices rose on Wednesday with data indicating a decrease in US crude oil inventories, growing expectations of interest rate cuts from the US Federal Reserve (Fed), oil output and export halt in Libya and rising tensions in the Middle East contrary to cease-fire attempts.
International benchmark Brent crude increased 0.08% to $78.73 per barrel at 10.26 a.m. local time (0726 GMT), up from the previous session's close of $78.66.
US benchmark West Texas Intermediate (WTI) rose by 0.1% to $75.61 per barrel, after closing at $75.53 in the prior session.
The American Petroleum Institute (API) data showed a 3.4 million barrel fall in US crude oil inventories, against the market prediction of a 3 million barrel draw.
The fall in the US commercial crude oil reserves supported upward price movements by reflecting market perceptions of a stronger domestic demand. If a fall in crude oil inventories is confirmed by the Energy Information Administration (EIA) later in the day, the prices are likely to rise further.
Meanwhile, a potential interest rate cut decision from the Fed continues to impact oil prices.
Fed Chairman Jerome Powell last week signaled an interest rate cut, saying the 'time has come' for an adjustment in monetary policy.
'The direction of travel is clear, and the timing and pace of rate cuts will depend on incoming data, the evolving outlook, and the balance of risks,' Powell told the annual Jackson Hole symposium in the US state of Wyoming.
While it is widely anticipated that the Fed will implement a 100 basis point interest rate cut by the end of the year, it is predicted that a 50 basis point reduction might be made during the November meeting.
Global supply concerns influenced by the suspension of oil production in Libya also bolstered oil prices.
The eastern-based Libyan Government, headed by Osama Hammad declared 'force majeure' in all oil fields, ports, and institutions and the suspension of oil production and exports due to disagreements over the management of the Central Bank on Monday.
Concerns that the ongoing conflicts in the Middle East may escalate and affect a broader region also support upward price movements.
Despite international calls for a ceasefire in Gaza, Israeli operations in the area and ongoing clashes between Israel and Lebanon persist. The Israeli public broadcaster KAN reported that the army had initiated a wide-scale operation in the northern part of the West Bank.
The report highlighted that Israeli security forces conducted simultaneous operations in the cities of Jenin and Tulkarem with support from combat helicopters and unmanned aerial vehicles, or drones.
By Duygu Alhan
Anadolu Agency
energy@aa.com.tr