Zhang Mengying

Investing.com – Oil was up on Thursday morning in Asia as U.S. demand stays strong and China demand may rebound with COVID-19 curbs easing.

The price rose 0.2% to $123.90 at 11:44PM ET (3:44AM GMT) and edged up 0.8% for $122.33.

Wednesday’s U.S. crude supply data from the showed a build of 2.025 million barrels for the week ended June 3.

EIA data indicated that U.S. gasoline inventories fell by 812,000 barrels and reached 218.18 million last week. This suggests fuel demand resilience in peak summer, despite high prices.

“It’s hard to see a significant downside in the coming months, with the gasoline market likely to only tighten further as we move deeper into driving season,” ING’s head of commodities research Warren Patterson said.

The day before, crude supply data showed that there was an increase in demand of 1.85 million barrels.

in the day showed that the exports of the world’s largest oil importer grew in May, adding to hopes that global oil demand could grow even further as China continues easing COVID-19 curbs.

“China’s reopening continued to boost the demand optimism,” CMC Markets analyst Tina Teng said in a note.

“The oil price could be heading to the peak of March at above $130 on a very tight supply market.”

On the supply side, UAE energy minister Suhail al-Mazrouei said on Wednesday that efforts by the Organization of the Petroleum Exporting Countries and allies (OPEC) oil producers to increase output are “not encouraging”.

Although the producers do not have enough capacity to fulfill the agreement, they agreed to increase production in order to reduce fuel costs.