2019.07.2406:44:00UTC+00Oil Extends Gains On US Stock Draw

Oil prices rose on Wednesday to extend gains from the previous session, with signs of rising tensions in the Middle East, the resumption of U.S.-China trade talks and data showing a much bigger than expected drop in U.S. inventories lending support.

The upside, however, remained limited by growth concerns after the International Monetary Fund (IMF) cut its growth forecasts for the global economy for this year and next.

Benchmark Brent crude edged up 0.1 percent to $63.91 a barrel, after rising nearly 1 percent in the previous session. U.S. West Texas Intermediate crude futures were up 0.3 percent at $56.91 a barrel.

Gulf tensions remain elevated, with the American military saying the U.S. may have brought down two Iranian drones in the Gulf last week, not one.

Iranian President Hassan Rouhani said today his country was open to holding talks on its nuclear program but would not surrender under the name of negotiation.

On Tuesday, the American Petroleum Institute (API) reported a huge crude oil inventory draw of 11 million barrels in the week to July 19, compared to analyst expectations of a much smaller 4 million barrel draw. The U.S. government's official figures are due later today.

Investors also weighed signs of progress in U.S.-China trade talks after White House economic adviser Larry Kudlow said it was a good sign that top U.S. officials would travel to China for reviving stalled trade talks.