Oil prices climb ahead of IEA report

Oil drilling rigs

Oil prices rose today, Dec. 12, as investors awaited the International Energy Agency's monthly report after OPEC cut its forecast for global oil demand growth for the fifth straight time.

International benchmark Brent crude was trading up 0.24% at $73.70 a barrel, at 09:26 am Makkah time. West Texas Intermediate (WTI) crude rose 0.13% to $70.38 a barrel.

The Organization of the Petroleum Exporting Countries (OPEC) lowered its forecast for global oil demand growth in 2024 and 2025 for the fifth time in a row, to 1.61 million barrels per day and 1.45 million barrels per day, respectively.

Meanwhile, data released by the US Energy Information Administration showed that commercial oil inventories fell by 1.4 million barrels last week, while gasoline inventories increased by 5.1 million barrels, and distillates by about 3.2 million barrels.

The data provided conflicting indications about the state of fuel demand in the world's largest economies, amid continued concerns over weak Chinese consumption that continue to dominate markets.

Oil prices received some support from the decision of the European Union foreign ministers on Dec. 11 to impose the 15th package of sanctions on Russia over its war with Ukraine, which included targeting the so-called “shadow fleet” of ships that Moscow uses to transport oil and circumvent G7 restrictions.

Additionally, investors in various markets were optimistic about the prospects of monetary easing in the US after the inflation reading for November came in line with expectations, which will boost demand for crude oil in the US.