Oil jumps 3% amid reported US crude stockpile drawdown

Oil drilling rigs

Oil prices climbed amid industry data pointing to drawdowns in US crude and fuel stockpiles, growing supply concerns and offsetting concerns over slowing demand from top importer China.

Brent crude futures rose $2.94, or 2.8%, to $107.91 a barrel amid thin trading volume on Wednesday, with China and Japan closed for holidays. West Texas Intermediate crude futures rose $3.02, or 3%, to $105.43 a barrel. 

The gains come from news that the European Union is working on new sanctions against Russia for waging war on Ukraine that will target Moscow's oil industry.

European Commission President Ursula von der Leyen is likely to spell out the plans on Wednesday, Reuters reported, citing officials.

Crude stocks fell by 3.5 million barrels for the week ended April 29, according to market sources, citing American Petroleum Institute figures.

US government data on stockpiles is due today.

Meanwhile, the OPEC+ is expected to stick to another monthly production increase policy, as it has undershot output targets between October and March, except for February.