MELBOURNE : Oil prices rose in early trade on Wednesday after industry data showed U.S. crude stockpiles fell more sharply than expected last week, highlighting supply tightness ahead of a looming European Union ban and G7 price cap on Russian oil.
Both benchmark contracts rose about 1 per cent in the previous session as the United Arab Emirates, Kuwait, Iraq and Algeria reinforced comments from Saudi Arabia's energy minister that the Organization of the Petroleum Exporting Countries and allies, together called OPEC+, were not considering boosting oil output. OPEC+ next meets to review output on Dec. 4.
The price cap, yet to be announced but due to be in place from Dec. 5, will probably be adjusted a few times a year, a senior U.S. Treasury official said on Tuesday. Buoying prices on Wednesday, U.S. crude inventories fell by about 4.8 million barrels for the week ended Nov. 18, data from the American Petroleum Institute showed, according to market sources.