Oil edges up from two-week lows as investors await US inventory data

Oil prices rise: Oil prices edged higher on Thursday from two-week lows, with investors eyeing developments in Middle East and more details on China's stimulus plans, as well as awaiting release of official US oil inventory data.

Brent crude futures LCOc1 rose 17 cents, or 0.2 per cent, to $74.39 a barrel by 0408 GMT, while US West Texas Intermediate crude futures CLc1 were at $70.58 a barrel, up 19 cents, or 0.3 per cent.

Both benchmarks settled down on Wednesday, closing at ir lowest levels since Oct. 2 for a second day in a row.

benchmarks are down 6-7 per cent so far this week after Organization of Petroleum Exporting Countries (OPEC) and International Energy Agency cut demand forecasts for 2024 and 2025.

Prices have also fallen as risk premiums have cooled with fears having eased that a retaliatory attack by Israel on Iran could disrupt oil supplies, though uncertainty remains over conflict in Middle East.

"We are now playing a waiting game for two things. Firstly China NPC (National People's Congress) standing committee to flesh out details and size of fiscal stimulus package which I believe is coming," Tony Sycamore, IG market analyst in Sydney, said.

Investors are waiting for furr details from Beijing on its bro plans announced on Oct. 12 to revive its ailing economy.

China said on Thursday it would expand a "white list" of housing projects eligible for financing and increase bank lending for such developments to 4 trillion yuan ($562 billion) as it aims to shore up its ailing property market.

Sycamore said Israel's response to Iran's recent attack was second major focus for market.

"It’s coming, we know that but we don't know when," he said, ding that both factors created upside risks for crude oil prices.

In Iran, authorities are working to control an oil spill off Kharg Island, country's IRNA news agency reported on Wednesday.

"It appears to be unrelated to Israel-Hamas war, but it drew attention to Iran's oil export facilities," ANZ analysts said in a note.

In US, crude oil and fuel stocks fell last week, market sources said, citing American Petroleum Institute figures on Wednesday, against expectations of a build-up in crude stockpiles.

Crude stocks fell by 1.58 million barrels in week ended Oct. 11, sources said on condition of anonymity. Gasoline inventories fell by 5.93 million barrels, and distillate stocks fell by 2.67 million barrels, y said.

Ten analysts polled by Reuters h estimated on average that crude inventories rose by about 1.8 million barrels in week to Oct. 11. EIA/S

"Any signs of weak demand in EIA’s weekly inventory report could put furr downward pressure on oil prices," ANZ analysts said.

Energy Information ministration, statistical arm of US Department of Energy, will release its data at 11:00 a.m. EDT (1500 GMT) on Thursday.

Also supporting oil prices, European Central Bank is likely to lower interest rates again on Thursday, first back-to-back rate cut in 13 years, as it shifts focus from cooling inflation in euro zone to protecting economic growth.