Oil ticked up on Wednesday, buoyed by hints of solid demand encompassing US as optimism that Fed will likely begin trimming rate bolstered sentiment regardless stubborn inflation figures.

Market sources, citing American Petroleum Institute figures ahead of Wednesday's official U.S. inventory report, indicated a decline in U.S. crude oil and fuel inventories last week, suggesting robust demand.

Brent crude advanced 1%, to $82.75 per barrel while US WTI rose 0.8% to $78.15 per barrel.

On Tuesday, oil prices dropped following a forecast indicating higher-than-expected U.S. crude oil production and bearish economic data. However, ongoing geopolitical tensions prevented significant declines.

As an early indication of robust demand, the Organization of the Petroleum Exporting Countries (OPEC) maintained its forecast for oil demand growth of 2.25 million barrels per day (bpd) in 2024 on Tuesday, surpassing numerous other projections.

Both oil and broader financial markets received support from the sentiment that slightly higher than anticipated U.S. inflation would not hinder interest rate cuts by mid-year. Reduced rates bolster oil demand.