Crude oil futures settled sharply higher on Thursday amid optimism about strong outlook for energy demand.
Oil futures pared some gains after the OPEC+ said it will decide on increasing output on Friday, a day later than originally scheduled. The OPEC members and their allies are likely to decide to add about 2 million barrels per day from August.
West Texas Intermediate Crude oil futures for August ended up by $1.76 or about 2.4% at $75.23 a barrel, almost $1 off the session’s high of $76.22, the highest level since October 2018.
Brent crude futures climbed nearly $1.50 or about 2% to $76.10 a barrel.
Despite concerns that oil demand could falter in the near term due to the surge in the delta variant of the coronavirus cases and travel curbs in several countries, analysts expect demand to pick up during the later part of the year.
Data from Energy Information Administration showed crude inventories in the U.S. dropped by 6.7 million barrels in the week ended June 25, much higher than an expected drop of 4.7 million barrels.