Crude oil is extending yesterday’s gains and may keep rising on the intraday as sentiment improved following a global growth upgrade from the International Monetary Fund (IMF) on Tuesday which improved the outlook for oil demand. Due to accelerating economic growth in industrialized countries, the IMF raised its global growth forecast for the first time in nearly two years. The IMF predicted global economic growth of 3.7% in 2014, up from the 3.6% growth forecast issued in October. Meanwhile, the International Energy Agency (IEA) said yesterday that the improving global economic growth, boosted by a robust economic rebound in the US, will absorb more supply even as US shale oil output reaches record highs. World oil consumption will rise by 1.3 million barrels a day, or 1.4 percent, to a record 92.5 million this year, the IEA’s monthly report shows. The gain is the first year of annual demand expansion in developed nations since 2010. “Improvement in global industrial production will translate to higher energy demand. Technical factors and better demand outlook are likely to keep oil prices supported�, said Michael McCarthy from CMC Markets in Sydney. Oil also found support from speculation that the US Energy Information Administration report tomorrow may show distillate inventories declined for a second week by 500,000 barrels in the world’s biggest oil consumer. The EIA will release its report a day later than usual because of the Martin Luther King Jr. Day holiday on January 20, while the American Petroleum Institute is scheduled to publish separate stockpile data later today.

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