• WTI prices extend its upside to $88.40 amid a tighter supply and optimistic oil demand outlook.
• US EIA forecast that global oil output will rise to 101.2M barrels per day (bpd) in 2023 and 102.9M bpd in 2024.
• API report showed a 1.174M barrels build in the US crude oil inventories compared to the previous week’s -5.521M barrels.
• Oil traders await the US Consumer Price Index (CPI), EIA Crude Oil Stocks Change on Wednesday.

Western Texas Intermediate (WTI), the US crude oil benchmark, is trading around the $88.40 mark so far on Wednesday. WTI prices climbs to the highest level in 10 months after the Organization of the Petroleum Exporting Countries (OPEC) forecasted a surge in oil demand.

OPEC maintained its forecast for robust growth in global oil demand in 2023 and 2024 despite challenges such as high-interest rates and higher inflation. OPEC predicted in a monthly report that global oil demand will climb by 2.25 million barrels per day (bpd) in 2024, up from 2.44 million bpd in 2023. Both projections were unchanged from the previous month.

Furthermore, the US Energy Information Administration (EIA) forecast that global oil output will rise from 99.9 million barrels per day (bpd) in 2022 to 101.2 million bpd in 2023 and 102.9 million bpd in 2024, while global demand will rise from 99.2 million bpd in 2022 to 101.0 million bpd in 2023 and 102.3 million bpd in 2024.

About the data, the American Petroleum Institute (API) showed a 1.174M barrels build in the US crude oil inventories for the week ending of September 8 compared to the previous week’s -5.521M barrels.

Furthermore, a tighter supply by voluntary oil production cuts by Saudi Arabia and Russia has boosted WTI prices in recent weeks. That said, Saudi Arabia and Russia, the world’s major oil exporters stated that they will extend oil production cuts for the rest of 2023. The cut will bring Saudi crude output closer to 1.3 million barrels per day through the end of 2023.

Adding to this, the OPEC report indicated that OPEC oil output increased in August, owing to a rise in Iran's production even though US sanctions against Tehran remain in place.

On the other hand, the fear of the economic slowdown in China might limit the WTI's upside potential as China is the world's largest oil importer. Oil traders await the Chinese Retail Sales and Industrial Production for August for fresh impetus.

Looking ahead, oil traders await the release of the US Consumer Price Index (CPI) for August ahead of the EIA Crude Oil Stocks Change for the week ending September 8 due on Wednesday. These events could significantly impact the USD-denominated WTI price. Oil traders will take cues from the data and find trading opportunities around the WTI prices.