Investing.com-- Oil prices rose in Asian trade on Thursday, recovering some ground after days of bruising losses as industry data showed that U.S. inventories marked an unexpected draw in the past week.
Focus remained on a potential escalation in the Middle East conflict, as well as on any more signals on stimulus in top oil importer China.
Brent oil futures expiring in December rose 0.6% to $74.67 a barrel, while West Texas Intermediate crude futures rose 0.6% to $70.27 a barrel by 21:02 ET (01:02 GMT).
Both contracts fell sharply over the past week, with losses intensifying in recent sessions after two major industry groups cut their outlook for demand growth. Reports of a less severe escalation in tensions between Israel and Iran also weighed on oil prices.
US inventories unexpectedly shrink- API
Data from the American Petroleum Institute showed on Wednesday that U.S. oil inventories fell by 1.58 million barrels in the week to October 11, against expectations for a build of 3.2 mb.
The API data usually heralds a similar reading from official inventory data, which is due later on Thursday. The reading pushed up some hopes that U.S. oil supplies remained tight, even as adverse weather conditions in the mid-South weighed on travel demand.
But oil markets were also reeling from two weeks of bumper builds in U.S. inventories.
Oil prices nurse steep losses amid demand fears
Oil prices were down between 5% and 6.5% over the past week, having clocked steep losses on concerns over weak demand, and as a report suggested Israel’s retaliation against Iran will not be as severe as feared.
Underwhelming signals on stimulus in China dented oil, as Beijing provided few details on the timing and scale of recently unveiled fiscal measures. China is set to hold a briefing later on Thursday outlining plans to support the property market.
Concerns over slow demand were furthered by both the International Energy Agency and the Organization of Petroleum Exporting Countries cutting their forecast for global oil demand growth in the coming years. Both bodies cited weakness in China as their biggest source of concern.
Focus was also largely on Israel’s retaliation against Iran over an early-October missile strike. But reports said that Israel told U.S. officials it will not target Iran’s oil and nuclear facilities- both