Recent economic indicators from the United States have fed into the optimism over global demand. U.S. consumer prices rose less than expected in April, data showed on Wednesday. At 3.4%, the annual rate of inflation was still considerable but on a monthly basis the rise was 0.3% rather than the 0.4% analysts had predicted, spurring optimism. Those expectations were further bolstered by data on Thursday that showed a stabilizing U.S. job market.
As a result, the possibility of a Federal Reserve interest rate cut boosted. Lower interest rates could help soften the U.S. dollar, which would make oil cheaper for investors holding other currencies and drive demand.
Two consecutive weeks of crude oil inventories and refined products in the United States declines also helped prices. The change in trader sentiment followed the release of the Energy Information Administration (EIA)’s latest weekly petroleum status report that revealed a larger-than-expected draw of 2.5 million barrels for the week to May 10. Analysts had expected a decline of 1 million barrels.
China reported inflation rate of 0.3% for April earlier this week, which was interpreted as a sign of strengthening economic growth despite ongoing challenges in the real estate sector. Earlier today, Beijing also released data showing a 2.3% annual increase in retail sales for April, along with a 6.7% expansion in industrial production for that month. Both are positive numbers that may add to the bullish case for oil.
In its monthly report, OPEC expects strong global oil demand for the summer, due to anticipation of rising transportation fuel consumption and holiday travel. The expected global oil demand growth rate is 2.2 million barrels per day (bpd) for this year, with a growth of 1.8 million bpd next year.

With the release of new information on US inflation and the possibility of a Federal Reserve interest rate cut this year, the gold price has increased for the second consecutive week. The price per ounce of gold reached $2414.5, indicating a 2.3% growth compared to last week.