Oil rebounded from the biggest daily loss in four weeks as industry data showed US crude and gasoline stockpiles declined.
Futures climbed as much as 1.4 percent in New York, paring Wednesday’s 4.1 percent loss. Crude and gasoline inventories both dropped by more than by 5.5 million barrels last week, the American Petroleum Institute was said to report. Government data released on Thursday is also forecast to show supplies fell. The market has “materially worsened” and prices may be stuck near $50 a barrel or below, according to Astenbeck Capital Management LLC’s Andy Hall.
Oil remains in a bear market amid concerns that rising supply from Libya to the U.S. will counter production cuts from the Organization of Petroleum Exporting Countries and its partners including Russia. American crude stockpiles are more than 100 million barrels above the five-year average.
Barnabas Gan, an economist at Oversea-Chinese Banking Corp. in Singapore, said: “Gasoline demand has increased because of the U.S driving season and that’s a good sign for the market.
“The rally is still extremely fragile and any signs which point to a higher supply environment into the second half could be a factor for oil prices to fall further.”
West Texas Intermediate for August delivery added as much as 65 cents to $45.78 a barrel on the New York Mercantile Exchange, and was at $45.72 at 8:09 a.m. in London. Total volume traded was about 6 percent above the 100-day average. The contract lost $1.94 to close at $45.13 on Wednesday, snapping the longest run of gains this year.
Brent for September settlement gained as much as 65 cents, or 1.4 percent, to $48.44 a barrel on the London-based ICE Futures Europe exchange. Prices slid $1.82, or 3.7 percent, to $47.79 on Wednesday. The global benchmark traded at a premium of $2.47 to September WTI.
US crude stockpiles dropped by 5.8 million barrels last week, the API said, according to people familiar with the data. An Energy Information Administration report Thursday is forecast to show inventories dropped by 2 million barrels, according to a survey.
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