Oil Rises on Lower Stockpiles, Bullish Mood After Inflation Data

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Oil prices were rising, buoyed by shrinking stockpiles and a wider risk-on mood.

Brent crude was up 0.4% at $83.06 a barrel, while WTI rose 0.3% to $78.86 a barrel.

The market is bullish after Consumer Price Index data showed U.S. inflation eased slightly in April in line with expectations, offering scope for looser Federal Reserve monetary policy and tugging the dollar lower, MUFG analysts said in a note.

U.S. crude oil stockpiles have also declined more than expected, with commercial crude oil inventories falling by 2.5 million barrels last week, according to the Energy Information Administration.

Effective OPEC+ market management should ensure Brent remains in the $80-$100 a barrel range in 2024, with the base case seeing the group leveraging its inelastic pricing power and the ceiling from ample spare capacity to handle tightening shocks, MUFG said.