Oil prices were moving higher on Wednesday, after a trade group reported falling U.S. inventories ahead of official data expected later. Hopes that China’s COVID outbreak is slowing also drove some optimism for the commodity.
Price action What’s driving markets? Data due later from the Energy Information Administration is expected to show a 2.1 million barrel rise in oil inventories, according to analysts surveyed by S&P Global Commodity Insights. Gasoline is expected to slip 100,000 barrels and distillates 1 million barrels.
While investors watch to see whether Europe can put together a ban on Russian oil, hopes for easing COVID restrictions in China, the world’s biggest crude importer were another factor for the gains, said analysts. . “And with unaffordable prices at the pump, which are a by-product of demand exceeding supply, the Fed will be on a mission to raise rates to at least moderate the demand side of the economy, which could eventually filter through to a mild form of demand destruction where there could be a buyer strike rather than buyers splurge over US peak driving season,” he said.