Investing.com — Oil prices rose slightly on Thursday, extending recent gains after signs of cooling U.S. inflation and a drop in U.S. inventories.
At 09:10 ET (13:10 GMT), the price rose 0.3% to $85.37 per barrel, while it rose 0.4% to $82.42 per barrel.
The US CPI slowed in June
Data released earlier Thursday showed the U.S. fell year-over-year to 3.0% in June, while the monthly rate actually fell 0.1%.
These numbers indicate a cooling of price pressures, adding to expectations that the Federal Reserve could initiate a rate-cutting cycle in September.
The Federal Reserve chairman noted in a speech to Congress earlier this week that the US economy was still on track for a soft landing.
Powell also said the Fed did not need to wait for inflation to fall below the 2% target to start cutting rates. His comments dented the dollar, which helped the crude market by making oil cheaper for international buyers.
US crude oil inventories are falling
The market also received support from data released on Wednesday, which showed the US unexpectedly contracted in the week to July 5, amid increased demand from summer holiday travel.
But doubts remained about how strong US demand was, especially as it grew unexpectedly this week.
Still, traders positioned themselves for tighter US markets in the coming weeks as summer travel was expected to continue, while Hurricane Beryl also caused some disruptions to oil production in the Gulf of Mexico.
The IEA report points to slowing demand growth
The main gain was the International Energy Agency’s (IEA) forecast that global oil demand will slow to just under a million barrels per day this year and next, as Chinese consumption shrank in the second quarter due to economic problems .
Global demand rose by 710,000 barrels a year in the second quarter, the lowest quarterly increase in more than a year, the IEA, which advises industrialized countries, said in its report.
The Organization of the Petroleum Exporting Countries maintained relatively strong growth in global oil demand in 2024 and 2025 in its forecast published on Wednesday, saying the resilience of the global economy and revived air travel will support demand.
(Ambar Warrick contributed to this article.)
