The focus on Wednesday was USA government data showing a 10.6 million-barrel surge in gasoline supplies, the biggest build since 1993, which some traders said signalled a slow-down in demand that could prolong the global glut.
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We are expecting a rise in crude oil inventories, which should put further downward pressure on prices, ” ANZ said.
Futures rose as much as 3.2 percent in NY after China suspended a controversial equity circuit breaker system and its central bank set the yuan’s reference rate little changed after an eight-day stretch of weaker fixings.
Global Brent crude benchmarks were at $35.75 a barrel at 0856 GMT, down 67 cents or 1.9 percent from their previous settlement, their lowest since 2004.
USA benchmark West Texas Intermediate for February shed 58 cents to stand at United States dollars 33.39.
A potential initial public offering is under review for Saudi Arabian Oil Co., also known as Saudi Aramco, Mohammed bin Salman, the kingdom’s deputy crown prince, said in an interview with The Economist.
Crude prices, which have fallen by over 30% just in 2015, have increased their decline in December after the cartel, whose members pump more than a third of the world’s oil, made a decision to keep unchanged its current level of production, despite the low prices.
Data from American Petroleum Institute (API), an industry group, showed crude stocks fell last week by 5.6 million barrels, while stocks at the Cushing, Oklahoma, delivery hub rose by 1.4 million barrels.
Oil prices fell on Tuesday on concerns about the pace of economic growth in China and a stronger U.S. dollar, handing back some of the gains triggered by an escalation of tensions in the Middle East.
“The majority of market participants see the tensions between Saudi Arabia and Iran as negative for the oil price because they make it unlikely that OPEC will agree on any concerted action to reduce the oversupply”, said analysts at Commerzbank in a note.
“European crude and product inventories are close to full with Asian inventories moving closer to capacity during Q1 2016, with global residual surplus most likely having to be stored in the US, resulting in a potentially rapidly rising USA oil inventories”.
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While oil prices have bounced off lows, market participants remain unwilling to call an end to the slump.
