Investing.com -- Oil prices settled higher Thursday, as larger-than-expected draw in U.S. crude supplies and easing worries about the demand outlook helped spur bullish bets.
By 14:30 ET (19.30 GMT), the U.S. crude futures traded 2.1% higher at $74.08 a barrel and the Brent contract rose 1.5% to $79.03 a barrel.
Crude inventories in downward surprise, but gasoline, distillates stockpiles jump
Inventories of U.S. crude fell by roughly 2.5M barrels in the week ended Jan.12, exceeding expectations of a draw of 331,000 barrels.
Gasoline inventories, one of the products that crude is refined into, rose by roughly 3.1M barrels against expectations for an increase of about 2.2M barrels while distillate stockpiles rose by by about 2.4M barrels, compared to expectations of a rise of 880,000 barrels.
IEA predicts demand growth in 2024
The International Energy Agency stated in its monthly report that it now expects oil demand to grow by 1.24 million barrels per day in 2024, up 180,000 bpd from its previous projection.
The agency cited improved economic growth and lower crude prices in the fourth quarter.
This followed an even more bullish report from the Organisation of Petroleum Exporting Countries, released on Wednesday. The cartel stuck to its forecast for demand growth of 2.25 million barrels per day for 2024.
At the same time, extreme winter conditions in parts of the U.S. are set to hit production.
The oil producing state of North Dakota said on Wednesday that severely cold weather would see output fall by over 50% - a trend that is likely to dent overall U.S. production, which hit record highs over the past two months.
The more sanguine outlook helped eased worries that a weakening global economy would dent demand at a time when ongoing Middle East conflict continued to threaten supplies.
Military action continues in Middle East
Traders continue to monitor the military action in the Middle East, and the prospect of supply disruptions from the oil-rich region.
Attacks by Yemen-based Houthi militants against ships in the Red Sea have forced many companies to divert cargoes around Africa, adding to journey times and costs.
(Peter Nurse, Ambar Warrick contributed to this article.)