Oil rises 1% after US crude stocks signal tighter supply

Oil prices rose in early Asian trade on Wednesday after industrial data showed a decline in US crude and fuel stocks, which raised supply concerns.

The price hike comes on the back of Tuesday’s news that the European Union is preparing to impose new sanctions on Russia over its invasion of Ukraine targeting the Russian oil sector.

Officials said European Commission President Ursula von der Leyen is expected to announce the plans on Wednesday.

By 0001 GMT, Brent crude futures rose 90 cents, or 0.9 percent, to $105.87 a barrel. West Texas Intermediate crude futures rose a dollar, or one percent, to $103.41 a barrel.

According to market sources, citing data from the American Petroleum Institute, US crude and fuel stocks fell last week. Crude stocks fell by 3.5 million barrels in the week to April 29, the sources said.

The US government releases inventory data on Wednesday.

In the previous session, oil prices fell more than 2% due to concerns related to demand due to the prolonged closure measures in China to combat Covid-19.