WASHINGTON (dpa-AFX) - Oil prices rose on Thursday to extend gains from the previous session after data showed a bigger than expected drop in U.S. crude inventories in the week ended July 5.
OPEC's strong oil demand forecast and expectations for rate reductions from the U.S. Federal Reserve also helped pushed up prices.
Benchmark Brent crude futures rose 0.2 percent to $85.28 a barrel, while WTI crude futures edged up 0.2 percent to $82.24.
Traders cheered signs of growing demand after data from the U.S. Energy Information Administration (EIA) showed crude oil inventories fell by 3.4 million barrels last week on top of a 12.2-million-barrels plunge in the previous week.
Economists had expected crude inventories to drop by 3 million barrels last week. At 445.1 million barrels, U.S. crude oil inventories are about 4 percent below the five-year average for this time of year, the EIA said.
Meanwhile, oil cartel OPEC said in a report that it expects oil demand to rise by 2.2 million barrels per day this year, compared to the previous year.
On Wednesday, Fed Chair Jerome Powell said the U.S. central bank will make interest rate decisions 'when and as' they are needed, regardless of political factors.
Amid rising hopes for a September rate cut, investors await the release of U.S. CPI report later in the day for further direction.
Economists forecast annual U.S. CPI slowed to 3.1 percent in June from 3.3 percent in May.
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