Oil hits 3-week high on tightening US supply

Crude oil prices continued to rise as the US market opened on Thursday after hitting a three-week high earlier in the European market, extending its gains for a third day in a row, as Brent rose to a 10-day high on the back of a slower supply in the United States and the continued geopolitical tensions in the Gulf region.

By 12:55 GMT, US crude rose to $55.45 per barrel from the opening of $54.11, recording the high since May 31 at $55.68 and a low of $54.09.

Brent crude rose to $63.40 per barrel from the opening of $62.44, recording the high since June 10 at $63.88 and a low of $62.37.

The US crude added 0.2% in its second daily gain, after the weekly report of the US Energy Information Administration (EIA), while Brent lost more than 0.1%.

The EIA announced yesterday that the country's trade inventories fell by about 3.1 million barrels in the week ending June 14, the first decline in the last three weeks, exceeding experts' expectations of a drop by 1.5 million barrels.

According to the data, total US inventories fell to 482.7 million barrels, leaving the total of 485.8 million barrels, the highest level since July 2017, in a sign that the demand in the world's top oil consumer market is beginning to improve.

For the US oil production, last week it fell by about 100 thousand barrels per day, the second weekly decline in a row, bringing the total to 12.2 million barrels per day, moving away from the record level of 12.4 million barrels per day.

A US official said on Thursday that a US drone crashed into the international airspace over the Strait of Hormuz from an Iranian missile.

Earlier, some reports from Iran stated that the Revolutionary Guard dropped a US drone spy plane in the southern province of "Hormuz Jan".

Geopolitical tensions in the Gulf region escalated after last week's attacks on two oil tankers near the Strait of Hormuz, and Washington blamed Tehran for being behind the attacks, while Tehran had firmly denied its involvement.

On the other hand, members of the Organization of the Petroleum Exporting Countries agreed to meet on July 1st, followed by a meeting with non-OPEC allies on July 2nd, after weeks of debates over the date of the meeting.

OPEC and its allies are set to discuss whether to extend the global supply cut by 1.2 million bpd for another six months to the end of the year.