Fed chair comments seen as less hawkish than feared
API said to report crude stocks fall about 2.2 million barrels
Iranian official sees OPEC sticking to policy at next meeting
Coming up EIA supply report, 1530 GMT

LONDON, Feb 8 Reuters Oil rose for a third straight day on Wednesday as investor concern eased about U.S. interest rate hikes and an industry report pointed to a drop in U.S. crude inventories.

Comments from U.S. Federal Reserve Chair Jerome Powell on Tuesday were seen as less hawkish than feared, boosting risk appetite and weighing on the dollar. A weaker dollar makes oil cheaper for other currency holders.

It would appear traders had become a little more defensive on the expectation of a hawkish shift but Powell refrained from taking the leap, said Craig Erlam, senior market analyst at brokerage OANDA.

Brent crude rose 99 cents, or 1.2, to 84.68 a barrel by 0912 GMT. U.S. West Texas Intermediate WTI crude climbed 93 cents, or 1.2, to 78.07.

With less aggressive U.S. rate hikes, the market is hoping the world39;s biggest economy can dodge a sharp economic slowdown or even a recession that would hit oil demand, while China39;s reopening after ending COVID curbs also bolsters fuel use.

A looming oil demand surge together with lacklustre global supply growth will ensure that the oil balance tightens over the coming months, said Stephen Brennock of oil broker PVM.

On supply, OPEC and its allies, known as OPEC, decided last week to keep output curbs…