Brent crude futures for July delivery gained 15 cents, or 0.2%, to $84.37 a barrel, and U.S. WTI futures for July jumped 25 cents, or 0.3%, to $80.08
Oil prices rose in Asian trading on Wednesday on expectations major producers will maintain output cuts at a meeting this Sunday, and that fuel consumption should begin increasing with the start of the peak summer demand season.
Brent crude futures for July delivery gained 15 cents, or 0.2%, to $84.37 a barrel by 0304 GMT. U.S. WTI futures for July jumped 25 cents, or 0.3%, to $80.08. Both benchmarks added more than 1% a day earlier.
Traders and analysts expect the OPEC and its allies, known as OPEC+, to keep voluntary production cuts totalling around 2.2 million bpd in place.
The expectation of OPEC+ members extending their output cuts has injected optimism into the markets and the move will be seen as a concerted effort to stabilise prices and rebalance the global oil market, according to Sugandha Sachdeva, founder of SS WealthStreet.
Furthermore, the onset of the summer driving season in the U.S. spurs a seasonal rise in consumption and typically aids a positive momentum in crude oil prices, she said.
The Memorial Day holiday on Monday signals the start of the peak demand season in the U.S., the world’s largest oil consumer, and keeping the production cuts in place should keep prices supported as consumption rises.
Initial data suggest a relatively high number of U.S. holiday trips have been taken over the Memorial Day holiday, the traditional start of the driving season. Air travel has also been strong, Daniel Hynes, senior commodity strategist at ANZ Bank, said in a note.
Investors were also watching out for U.S. crude inventory data from the API being released later in the day. The data was delayed by a day due to the Memorial Day holiday on Monday.
