Oil prices rose on May 11, clawing back some of the previous day's losses, supported by positive fuel demand data from the US - world's top oil consumer and also a sharper than expected decline in the US gasoline inventories. The drop in US inventories of gasoline, distillates and jet fuel reflected a greater demand for transport fuels which has boosted the travel sentiment in the economy.

Brent crude last rose 52 cents, or 0.7 per cent, to $76.93 a barrel while US crude futures gained 48 cents, up 0.7 per cent, to $73.04. Both contracts were on track for their first weekly percentage gain in four sessions.

US gasoline inventories fell by 3.2 million barrels last week, more than the 1.2 million barrel draw forecast by analysts, according to data from the US Energy Information Administration. Distillate stocks also declined while US jet fuel demand rose to its highest since December 2019.

Investors are also awaiting news from talks on raising the US government's $31.4 trillion debt ceiling, which kicked off on May 10, with Republicans continuing to insist on spending cuts.

Also Read: Oil market buzz: OPEC+ report due on May 11; will prices rise on clues of another output cut?


US inflation slows to lowest in 2 years; gasoline costs reman high

The annual increase in U.S. consumer prices slowed to below 5 per cent in April for the first time in two years, while a key inflation measure monitored by the Federal Reserve subsided, potentially providing cover for the central bank to pause further interest rate hikes next month. The US consumer price index (CPI) rose 0.4 per cent last month after gaining 0.1 per cent in March.

In the 12 months through April, the CPI increased 4.9 per cent. That was the smallest year-on-year rise since April 2021 and followed a 5  per cent advance in March.

Nevertheless, inflation remains too strong, with the report from the Labor Department on May 10 showing monthly consumer prices rising solidly because of sticky rents as well as rebounds in the costs of gasoline and used motor vehicles.

Oil prices have since been largely trending lower, pushing gasoline costs down as risks of a recession have increased, because of the Fed rate hikes and tightening credit conditions.