Brent crude was up 58 cents, or 0.5%, at $117.98 at 0844 GMT,
and was on track for a gain of about 5% this week.
U.S. West Texas Intermediate (WTI) crude rose 27 cents, or 0.2%,
at $114.36 a barrel. WTI is set for a weekly gain of about 1%.
"Oil prices have risen to the highest level since end of March,
benefiting from renewed declines in U.S. oil inventories," said
UBS analyst Giovanni Staunovo.
U.S. gasoline stocks fell by 482,000 barrels last week to 219.7
million barrels, U.S. Energy Information Administration said on
Wednesday. The start of summer driving season in the United
States normally entails increased consumption.
"The U.S. driving season and strong travel demand should help
(prices). With supply growth lagging demand growth, the oil
market is likely to stay undersupplied. Hence, we remain
positive in our outlook for crude prices," Staunovo added.
Both benchmark crude contracts were also supported as the
European Commission continued to seek unanimous support of all
27 EU member states for its proposed new sanctions against
Russia, with Hungary posing a stumbling block.
A top Hungarian aide said the country needed 3-1/2 to 4 years to
shift away from Russian crude and make huge investments to
adjust its economy. Hungary could not back the EU's proposed oil
embargo until there was a deal on all issues, the aide said.
"The combination of actual loss of supply and the increasing
refusal to accept supply from Russia will see these commodities
(oil and gas) move considerably higher," said Clifford Bennett,
chief economist at ACY Securities.
Prices have gained about 50% so far this year.
OPEC+ is set to stick to last year's oil production deal at its
June 2 meeting and raise July output targets by 432,000 barrels
per day, six OPEC+ sources told Reuters. The OPEC+ members would
thereby rebuff Western calls for a faster increase to lower
surging prices.
(Reporting by Bozorgmehr Sharafedin in London, additional
reporting by Stephanie Kelly in New York and Koustav Samanta in
Singapore; Editing by Richard Pullin, Bradley Perrett and Kim
Coghill)
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