Oil prices rose on Thursday after major producer Saudi Arabia rejected calls to increase OPEC+ production and after the International Energy Agency said higher natural gas prices could boost demand for oil to generate electricity.
But the market pared its gains after US crude stocks rose more than expected and refiners cut production.
Brent crude futures rose 42 cents, or 0.5 percent, to $83.6 a barrel at 1526 GMT, after hitting a session high of $84.50 a barrel.
US West Texas crude contracts also rose 21 cents to $80.65 a barrel.
US crude stocks rose 6.1 million barrels in the week to Oct. 8, compared with a rise of 702,000 barrels expected by analysts polled by Reuters.
The International Energy Agency said that the demand for crude is expected to rise by half a million barrels per day, as the electricity sector and heavy industries shift to crude, from more expensive energy sources, and warned that the energy crisis may fuel inflation and slow the recovery of the global economy from the pandemic.
In a monthly report, the agency increased its forecast for global oil demand growth in 2022 by 210,000 barrels per day, to reach 99.6 million barrels per day, which is slightly higher than the pre-pandemic level.
Saudi Arabia has rejected calls to increase OPEC + production, saying that the group’s process of eliminating production cuts protects the market from the wild price fluctuations witnessed in the gas and coal markets.
The article, oil pares its gains after a significant increase in US inventories, was written in Al Borsa newspaper.