By: Economy Middle east

Oil prices edged higher on Thursday after two straight sessions of losses, supported by a larger-than-expected drop in U.S. crude stockpiles, which encouraged investors to step back into futures markets while keeping a close eye on developments in Venezuela.

As of 5:04 GMT, Brent crude futures rose 33 cents, or 0.55 percent, to $60.29 a barrel, while U.S. West Texas Intermediate gained 30 cents, or 0.54 percent, to $56.29 a barrel.

U.S. crude inventories fall as supply concerns persist

The gains in oil prices followed two consecutive sessions of declines, with both benchmarks having dropped more than 1 percent on Wednesday as traders priced in expectations of abundant global supply this year. Analysts, including those at Morgan Stanley, have forecast a potential surplus of up to 3 million barrels per day in the first half of 2026.

“The IEA projects a surplus of nearly 4 million barrels per day this year, so downside risks remain high even after last week’s 2.8 million-barrel API draw. Given little confidence in near-term tightening, WTI is likely to remain bearish unless demand picks up strongly or there is clear action to limit supply,” said Vijay Valecha, chief investment officer, Century Financial.

U.S. crude inventories fell by 3.8 million barrels to 419.1 million barrels in the week ended January 2, the Energy Information Administration reported, defying analysts’ expectations of a 447,000-barrel build.

U.S. seizes two oil tankers linked to Venezuela

Oil prices rose after the United States on Wednesday seized two oil tankers linked to Venezuela in the Atlantic Ocean as part of President Donald Trump’s efforts to control oil movements in the region and pressure Venezuela’s socialist government to align with Washington.

A day earlier, U.S. officials announced an agreement with Caracas granting access to as much as $2 billion worth of Venezuelan crude. Under the deal, Venezuela will hand over between 30 million and 50 million barrels of oil that had been subject to sanctions, Trump said in a social media post.

The arrangement could ease bottlenecks in Venezuelan oil exports, which have been constrained by a U.S. blockade on sanctioned tankers. Redirecting these volumes to the U.S. could also limit the need for Venezuela to curb production due to storage limitations.

“OPEC+ over the weekend reaffirmed its decision to keep production policy unchanged through the first quarter, reinforcing the view that supply remains ample elsewhere despite the short-term disruption of Venezuelan barrels. At the same time, unrest in Iran and the persistent risk of Middle East disruptions continue to provide a partial offset to downside pressure, limiting the scope for a deeper sell-off,” said Ole Hansen, head of commodity strategy, Saxo Bank.