Oil prices rise on signs of increased demand in Europe and China

Reuters reports that oil rose on Wednesday amid signs of increased demand in China and Europe, as well as lower US production.

As crude prices have fallen in recent weeks, some US companies, such as Diamondback Energy and Coterra Energy, have announced rig cuts. ANZ bank strategist Daniel Hynes believes the decision will eventually lead to higher oil prices due to lower production.

Meanwhile, according to the American Petroleum Institute (API), US crude inventories fell by 4.49 million barrels in the week to May 2.

Signs of improving demand also pushed oil prices up. Spending by Chinese consumers surged during the May Day celebration. In addition, the return of market participants from China after a five-day holiday had a positive impact on crude prices, Reuters says. 

Companies in Europe are expected to report a 0.4% rise in earnings for the first quarter of 2025. This figure is significantly higher than the previously forecast 1.7% drop, the news agency says.