Oil resumes rally ahead of US inventories data

Oil prices continued to rise as the US market opened on Tuesday, and resumed rally after taking a pause yesterday, with the US crude jumping near its 7-year peak, and Brent crude rising near its 3-year high, due to concerns over a market deficit while the global demand accelerates, ahead of preliminary data on the US crude inventories later today.

US crude rose 1.6% to $83.57 a barrel, after opening at $82.28, and hit a low at $82.08, and Brent crude rose 1.1% to $85.10 a barrel, after opening at $84.22, and hit a low at $83.86.

The US crude lost 0.25% yesterday, on profit-taking from 7-year high at $83.85.

Brent fell more than 0.9%, after hitting the highest since October 2018 at $86.02.

Oil prices are rising due to growing fears over a market deficit, especially after OPEC Plus alliance's recent decision to keep its current production policy without any new production hikes.

Meanwhile, global demand for oil is growing, especially due to the global shifting from gas to oil, after the recent record spike in natural gas prices.

The American Petroleum Institute will release its preliminary report on the US crude inventories later today, and the US Energy Information Administration will release the official data on Wednesday.

The API reported last week that the US crude stocks rose to the highest level in a month and a half, which is a negative sign about demand and consumption levels in the US.