Brent crude falls ahead of weekly US inventory data

Oil drilling rigs

Brent crude declined on Thursday ahead of the release of US inventory data amid strong demand and short-term supply disruptions.

"Shorter-term supply disruptions are also helping tighten markets. Brent crude rallied sharply after reports a key oil pipeline running from Iraq to Turkey was knocked out by an explosion," analysts at ANZ bank said in a note.

Global oil demand is expected to exceed pre-pandemic levels this year as fears over the latest coronavirus wave subside, the International Energy Agency (IEA) said, adding that the low level of stocks and shrinking spare capacity means that oil markets could be in for another volatile year in 2022.

Benchmark Brent crude fell 0.2% to $88.26 a barrel. Meanwhile, WTI rose 0.36% to $87.27 a barrel.

The American Petroleum Institute data revealed that crude inventories rose by 1.4 million barrels in the week ended Jan. 14.

The US Energy Information Administration (EIA) will release official inventory data later today.