Brent crude settled at $68.05, up 83 cents (1.2%), while West Texas Intermediate (WTI) gained 90 cents (1.4%) to close at $64.15. Both contracts had fallen more than 2% on Tuesday.
The EIA reported a 2.4 million-barrel decline in U.S. crude stocks last week, larger than the forecast draw of 1.9 million barrels. Gasoline inventories fell 1.2 million barrels (short of expectations for a 2.2 million-barrel decline), while distillate stocks dropped 1.8 million barrels against forecasts for a build. Analysts pointed to gasoline demand ahead of the Labor Day holiday as a seasonal driver.
Geopolitical tensions also remained a focal point. President Donald Trump’s decision to double tariffs on Indian imports to 50% took effect Wednesday in response to New Delhi’s Russian crude purchases. While direct disruption to oil flows has not materialized, UBS analyst Giovanni Staunovo noted that uncertainty is deterring some traders from taking new positions. India’s finance ministry acknowledged potential ripple effects on growth in its latest economic review.
At the same time, Russia and Ukraine escalated attacks on energy infrastructure, with Moscow targeting Ukrainian gas transport systems and Kyiv striking Russian refineries and export terminals. Russia has revised up its August crude exports from western ports by 200,000 bpd after refinery outages freed up crude.
Looking ahead, traders are also monitoring central bank signals. New York Fed President John Williams said interest rates are likely to fall at some point but policymakers will wait for upcoming data before deciding on a possible cut at the September 16–17 meeting. A rate cut could boost demand by lowering borrowing costs and stimulating growth.