09:10 AM EDT, 08/21/2024 (MT Newswires) -- Oil traded higher early on Wednesday, following three losing sessions that came on weak China demand and easing international tensions, and even as a report showed an unexpected rise in U.S. inventories last week.

West Texas Intermediate crude for October delivery was last seen up US$0.31 to US$73.46 per barrel, while October Brent crude, the global benchmark, was up US$0.32 to US$77.52.

The rise counters the pessimism that has dominated the market in recent days, with weak economic data from China showing the No.1 importer's appetite for oil is low and unlikely to soon strengthen. Concerns over a wider Middle Eastern war are easing as Iran continues to hold back on a promised revenge strike on Israel following the assassinations of senior figures in the Hezbollah and Hamas militias earlier this month.

"The crude oil market sentiment remains under pressure as China's economic slowdown and the rapid adoption of EVs and hybrid cars reduce fuel demand, leading to lower refinery runs and diminished oil demand. Refinery margins, the key driver for crude demand, remain weak in Europe and the USA, making it increasingly unlikely that OPEC+ will begin to unwind voluntary cuts from October," Ole Hansen, head of commodity strategy at Saxo Bank, noted.

In its weekly survey, the American Petroleum Institute reported U.S. oil inventories rose by 347,000 barrels last week, while the consensus estimate expected a drop of 2.9-million barrels, according to Oilprice.com. Gasoline and distillate inventories fell by 1.04-million and 2.25-mllion barrels respectively.

The Energy Information Administration will release official inventory data later on Wednesday morning.