WTI crude futures edged up toward $111 per barrel on Thursday, extending a cautious rally this week on signs of ongoing supply tightness while the EU continues to haggle with Hungary over plans to ban oil imports from Russia.
Official data showed a larger-than-expected drawdown in US crude inventories last week due to soaring exports, highlighting a tight global market.
The prospect of an EU embargo on Russian oil also kept upward pressure on crude prices, with European Council Charles Michel saying Wednesday he is confident that an agreement can be reached before the council’s next meeting on May 30.
Hungary is pressing for about 750 million euros to upgrade its refineries and expand a pipeline from Croatia to enable it to switch away from Russian oil.
Meanwhile, the demand outlook remained clouded amid varying degrees of Covid restrictions in China and lingering concerns about inflation leading to a global economic slowdown.