Title: Oil extends gains as risk appetite improves, U.S. inventories fall
Jul 28, 2022 02:41AM ET
Oil rose more than $1 a barrel on Thursday, extending gains from the previous session, supported by increased risk appetite among investors as falling crude inventories and a recovery in U.S. gasoline demand supported prices.
As of 0619 GMT, Brent crude futures for September rose $1.13, or 1.1%, to $107.75 a barrel as of 0619 GMT, after rising $2.22 on Wednesday.
West Texas Intermediate crude traded at $98.53 per barrel, up $1.27, or 1.3 percent, from the previous session's high of $2.28.
The U.S. Federal Reserve raised its key overnight interest rate by three-quarters of a percentage point, in line with expectations, to cool inflation, while the dollar fell on hopes of a slower hike path.
A weaker dollar makes oil, which is priced in dollars, cheaper for buyers in other countries.
According to Energy Information Administration data, US crude inventories fell 4.5 million barrels last week, falling short of expectations for a 1 million-barrel drop, while US gasoline demand recovered 8.5 percent on a weekly basis.
The U.S. cemented its position as the world's largest oil exporter, with combined gross exports of crude and refined products totaling a record 10.9 million barrels a day.
US crude exports reached a record 4.5 mb/d as WTI traded at a large discount to Brent, making purchases of US crude more attractive to foreign buyers.
U.S. crude production growth may also be limited by the availability of fracking equipment and crews, as well as capital constraints, executives said this week.
Russia has cut gas supplies through Nord Stream 1, its main gas link to Europe, to just 20% of capacity.
That could lead to a switch from gas to crude and raise oil prices in the short term, analysts say.