Crude oil futures hit fresh multiyear highs on Wednesday after the U.S. Energy Information Administration (EIA) lifted its forecasts for this year’s U.S. and global benchmark oil prices, but kept its predictions for global oil demand growth largely steady.
Brent futures for August delivery rose 19 cents, or 0.3 percent, to $72.41 per barrel, while WTI crude futures for July settlement were up 19 cents, or 0.3 percent, at $70.24.
According to a monthly report released Tuesday, the EIA forecast a decline in global oil inventories in the second half of 2021, reinforcing expectations of a demand-led recovery.
“We expect rising production will end the persistent global oil inventory draws that have occurred for much of the past year and lead to relatively balanced global oil markets in the second half of 2021,” the EIA said in the report.
There is an optimism around the demand outlook after the U.S. Centers for Disease Control and Prevention (CDC) eased travel recommendations for more than 110 countries and territories, including Japan just ahead of the Olympics.
The oil price rally was further supported by bullish inventory data, with the American Petroleum Institute (API) reporting a draw in crude oil inventories of 2.1 million barrels for the week ending June 4.