Oil prices rose above $80 a barrel on Tuesday as experts predicted a decline in the US inventories, the largest crude oil consumer in the world.
The rise in Asian equity markets and the likelihood of steady interest rates from regional central banks have also provided a boost to crude oil.
Similarly, emerging markets have continued to show a strong demand for fuel with India, the world’s third-largest oil consumer, recording a 5% increase in fuel consumption in March, reaching a record 4.83 million barrels per day.
The country remains the main destination for Russian Urals crude as global oil trade flows continue to shift following the invasion of Ukraine.
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The global industry figure obtained from oil price indicates Brent crude oil increased by 0.68% to $84.75 a barrel while US West Texas Intermediate rose by 0.75% to $80.34.
These gains come after OPEC and allies announced new production cuts starting in May, resulting in oil futures increasing by over 5%.
Despite this, oil prices fell on Monday after three consecutive weeks of increases, following the release of US jobs data that pointed to a tight labour market, heightening expectations of another Federal Reserve rate hike.
The resulting strength of the US dollar weighed on oil prices, as a strong dollar makes oil more expensive for other currency holders.
Investors are also waiting for the release of a US inflation report on Wednesday, which could impact near-term interest rates.