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Brent crude futures was up 10 cents, or 0.1%, to $74.13 a barrel
by 1032 GMT. U.S. West Texas Intermediate (WTI) crude futures
rose 11 cents, or 0.2%, to $69.67 a barrel.
Both benchmarks gained about 3% on Wednesday after the U.S.
Energy Information Administration (EIA) said crude inventories
dropped by 9.6 million barrels in the week ended June 23, far
exceeding the 1.8-million barrel draw analysts had forecast in a
Reuters poll.
"The jury is still out on whether the second part of 2023 will
bring with it the long-anticipated decline in inventories.
Nonetheless, the impact that stocks have on oil prices was on
display yesterday on a smaller scale," PVM Oil analyst Tamas
Varga said.
Concerns about the impact that rising interest rates will have
on economic growth came back to the fore, however, halting the
rally.
Leaders of the world's top central banks reaffirmed on Wednesday
that they think further policy tightening will be needed to tame
stubbornly high inflation but still believe they can achieve
that without triggering outright recessions.
U.S. Federal Reserve Chair Jerome Powell did not rule out
further hikes at the central bank's next meeting, while European
Central Bank President Christine Lagarde cemented expectations
for a ninth consecutive rise in euro zone rates in July.
Adding to pressure, annual profits at industrial firms in China,
the world's second-biggest oil consumer, extended a double-digit
decline in the first five months as softening demand squeezed
margins.
"The lack of prospects for fuel demand growth has limited the
gain in oil prices, even with supply curbs by oil producers,"
said Tetsu Emori, CEO of Emori Fund Management Inc.
Facing falling prices, Saudi Arabia this month pledged to
sharply cut its output in July, adding to a broader OPEC+ deal
to limit supply into 2024.
Brent's six-month backwardation reached its lowest since
December, but still indicated higher demand for immediate
delivery.
(Additional reporting by Yuka Obayashi; editing by Jason Neely)
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