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Oil prices rose marginally on Wednesday, bouncing off two-month lows hit in the prior session after an industry group reported US crude stockpiles fell last week.
Brent crude rose 24 cents, or 0.3 per cent, to $73.26 a barrel by 0735 GMT. US West Texas Intermediate crude oil futures was up 23 cents, or 0.3 per cent, at $69.16.
US crude stocks fell 640,000 barrels in the week ended February 21, market sources said on Tuesday, citing American Petroleum Institute data. Official US stockpile data is due later on Wednesday, reports Reuters.
"If confirmed by the EIA later today, it would mark the first decline in US crude oil inventories since mid-January," said ING commodities strategists in a note on Wednesday.
Analysts polled by Reuters estimated a 2.6-million-barrel increase in US crude stocks last week.
On the supply side, prospects for a peace deal between Russia and Ukraine are improving, said ING, while the market also eyed the potential implications of a minerals deal between the US and Ukraine.
"This would take us a step closer to Russian sanctions being lifted, removing much of the supply uncertainty hanging over the market," the ING strategists said.
The U.S. and Ukraine agreed terms of a draft minerals deal central to Trump's efforts to rapidly end the war in Ukraine, sources familiar with the matter told Reuters on Tuesday.
Meanwhile, dour economic reports from the U.S. and Germany capped price gains, after pulling oil prices more than 2.0 per cent lower on Tuesday. Brent crude closed at its lowest since December 23, while WTI recorded its lowest settlement since December 10.
US data showed consumer confidence in February deteriorated at its sharpest pace in 3-1/2 years, with 12-month inflation expectations surging. Meanwhile, the German economy shrank in the last three months of 2024 versus the prior quarter.
Oil prices have been buffeted by concerns that US President Donald Trump's decisions about tariffs against China and other trading partners could add to pressure on the country's economy.
That has eased worries about tighter near-term oil supply despite fresh US sanctions against Iran, ANZ Bank analysts wrote in a note to clients.
Even though US policy measures could drive an up to 1.0 million barrel-per-day reduction in Iranian crude exports, any loss in supply from the Middle Eastern nation is countered by OPEC+ members hoping to bring more supply to the market in the months ahead, Commodity Context analyst Rory Johnston said.