Oil Prices Rise on Decline in US Inventories and Easing Trade Tensions

Oil prices witnessed a significant increase during trading on Thursday, July 17, supported by a sharp decline in US inventories and improved economic indicators, along with positive signs regarding trade tensions among major countries.

Brent crude futures rose by 0.4% to reach $68.77 per barrel, while US crude futures increased by 0.5% to $66.73 per barrel, showing a clear recovery after a more than 0.2% decline in the previous session.

This rise was influenced by data from the US Energy Information Administration, which showed a significant decrease in crude inventories by 3.9 million barrels last week, reaching 422.2 million barrels. This decrease was much larger than expectations, which were only indicating a 552 thousand barrel decrease, reflecting an increase in refining activity and a decline in oil supply in the face of rising demand.

In a related context, the Federal Reserve's report revealed an improvement in economic activity in the recent period, with future expectations remaining "neutral to somewhat pessimistic," especially with the continued pressures of tariffs on imports.

Chinese growth data also showed a slowdown in the second quarter, but at a better level than previous fears, as the acceleration of some economic activities in anticipation of US tariffs helped alleviate market concerns about the world's largest oil consumer economy.

In another positive development, US President Donald Trump expressed optimism about the possibility of reaching a trade agreement soon with India, and did not rule out reaching an understanding with the European Union, enhancing market hopes for a reduction in global trade tensions.