Crude oil prices moved higher on Wednesday after official data showed a much larger than expected decline in U.S. crude inventories in the week ended July 24.

However, gains were just modest for crude oil futures as worries about energy demand outlook persisted due to continued surge in new coronavirus cases across the world.

West Texas Intermediate Crude oil futures for September ended up $0.23 or about 0.6% at $41.27 a barrel.

Brent crude futures moved up $0.45 to $43.67 a barrel.

According to the data released by the Energy Information Administration (EIA) this morning, crude oil inventories in the U.S. declined by as much as 10.6 million barrels last week, after rising by 4.9 million barrels a week earlier.

Late on Tuesday, the American Petroleum Institute released a report that said oil inventories declined 6.83 million barrels last week, almost twice the expected drop.

The EIA report showed gasoline inventories were up 700,000 barrels last week, compared with 1.8 million-barrel draw in the previous week.

Meanwhile, distillate fuels invntory increased by half a million barrels, compared with a 1.1 million barrels increase a week earlier.

In coronavirus news, several U.S. states in the South and West reported their biggest one-day increase in coronavirus deaths Tuesday, fueling a bitter debate over the reopening of schools in the coming weeks.

Mainland China has reported 101 new cases of the novel coronavirus – the highest number in more than three and a half months.

Hong Kong leader Carrie Lam warned that the city was on the brink of a large-scale outbreak and tightened lockdown measures.

Japan topped 1,000 Covid-19 cases for first time as Osaka and Aichi set daily records.

The material has been provided by InstaForex Company – www.instaforex.com