Oil prices rose modestly in Asian trading on Thursday, supported by a sharper-than-expected drop in U.S. crude inventories and improved sentiment following a new trade agreement between the U.S. and Japan.
Brent crude futures climbed 0.3% to $68.69 per barrel, while WTI crude gained 0.3% to $65.45. Prices had recently come under pressure due to concerns over impending U.S. tariffs scheduled for August 1.
The U.S. Energy Information Administration (EIA) reported a significant 3.17 million-barrel drop in crude stockpiles last week—nearly twice the decline forecasted by analysts—suggesting tightening supply. Gasoline inventories also fell, while distillate stocks saw seasonal growth.
Adding to bullish momentum was news of a trade pact between the U.S. and Japan, which includes tariff reductions and a $550 billion Japanese investment pledge in the U.S. economy. The deal also enhances U.S. access to Japanese markets, boosting investor optimism ahead of the upcoming tariff deadline.
However, traders remain cautious amid speculation that the European Union may introduce retaliatory measures, potentially affecting the outlook for global energy markets.