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Oil Prices Rally After EIA Data

Oil prices rose on Thursday to their highest since March amid signs of lower U.S. inventories and recovering demand as governments across the world ease lockdown restrictions imposed due to the coronavirus crisis.

Benchmark Brent crude for July delivery climbed 59 cents, or 1.65 percent, to $36.34 per barrel, while U.S. West Texas Intermediate crude futures were up by 60 cents, or 1.80 percent, at $34.90. Both benchmarks are at their highest since March 11.

Wednesday's Energy Information Administration (EIA) report showed that crude stockpiles in the U.S. fell by about 5 million barrels in the week ended May 15, as against expectations for an increase of about 1.8 million barrels.

Gasoline inventories rose 2.8 million barrels last week, while distillate stockpiles rose by 3.8 million barrels, the EIA said.

A report released late Tuesday by the American Petroleum Institute revealed that crude inventories in the U.S. decreased by 4.8 million barrels in the week to May 15.

With easing of lockdown restrictions worldwide boosting demand for fuel and oil producers adhering to output cut pledges, Brent crude has more than doubled since hitting a 21-year low below $16 in April.

The Organization of the Petroleum Exporting Countries, Russia and other allies, known as Opec+, agreed to cut supply by a record 9.7 million barrels per day (bpd) from May 1 to support the market.

So far in May, Opec+ has reportedly cut oil exports by about 6 million bpd.

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