MELBOURNE Reuters - Oil prices increased on Thursday, extending strong gains overnight with fuel demand growing and crude stocks declining as production remains hampered in the U.S. Gulf of Mexico after two hurricanes.
The market was also supported by a broader switch back in risk assets as concerns eased over potential default by China Evergrande and the possible fallout on the second largest economy.
U.S. West Texas Intermediate WTI crude futures rose 13 cents, or 0.2%, to $72.36 a barrel at 0143 GMT, while Brent crude futures rose 17 cents, or 0.2%, to $76.36 a barrel
Both benchmark contracts jumped 2.5% on Wednesday after data from the U.S. Energy Information Administration showed crude stocks fell by 3.5 million barrels to 414 million barrels in the week of Sept. 17, the lowest since October 2018, in a bigger drawdown than analysts had expected EIA S Oil fundamentals remain constructive, particularly in the U.S. ING commodity strategists in a note said in a note
ANZ Research said market sentiment is also supported by soaring natural gas prices.
Supply shortage of gas could encourage electricity utilities to change from petroleum to gas if winter turns out colder this year, ANZ analysts said in a note.
The rise in oil prices came even as the U.S. dollar hit a one-month high when the Fed raised its rate hikes more rapidly than forecast last year. Prices often rise when the dollar rises, as a stronger greenback makes oil more expensive for holders of other currencies.