Oil Prices At 5-Month High But Fuel Demand Worries Continue

On Thursday, international oil prices were slightly changed from the 5-month high seen in the rates on the previous day. Among global benchmarks for crude, US West Texas Intermediate (WTI) crude futures were down 3 cents, or 0.1 percent, at $42.16 a barrel, while Brent crude futures rose 6 cents to $45.23.

On Wednesday, the two contracts rose more than 1 percent to their highest since 6 March, after the Energy Information Administration reported a much bigger than expected drop in US crude stockpiles. However, investors are wary of rising US refined product inventories at a time when Federal Reserve officials said the resurgence in cases was slowing the economic recovery in the world's biggest oil consumer.

EIA data showed that the US stockpiles fell by 7.4 million barrels in the week ended 31 July while distillate stockpiles, which include diesel and heating oil, climbed to a 38-year-high, and gasoline inventories unexpectedly rose by 419,000 barrels for a second week in a row.

Further, the US dollar has logged its biggest monthly percentage fall in a decade against a basket of six currencies in July. The recent decline in the American currency has supported higher oil prices, that tend to rise to offset weakness in the dollar.