Oil Prices Rebound on Shrinking US Crude Inventories

Oil prices rebounded by over $2 per barrel on Wednesday morning, recouping some of Tuesday's losses caused by a pause in fighting between Washington and Tehran. The Brent futures contract increased by $2.71, or 3.2%, to $86.80 a barrel at 0002 GMT.

The rebound was driven by shrinking US crude inventories, which fell by about 3.3 million barrels in the week ended July 24, according to market sources citing data from the American Petroleum Institute. Official inventory data from the Energy Information Administration is due later on Wednesday.

Further supporting prices, OPEC+ will likely halt oil output increases for three months starting in October, sources told Reuters, after the producer group completes the scheduled return of barrels following voluntary cuts.