According to Andy Lipow of Lipow Oil Associates, weekly data released on Wednesday by the Energy Department helped nudge some prices higher.
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US West Texas Intermediate (WTI) crude futures were trading at $39.77 a barrel at 3.50am GMT, up 26c from their last settlement but still below the $40 marker they settled below for the first time since April in the previous session. Last week, the EIA reported that USA crude stockpiles fell by 1.9 million barrels the week-ending July 29. Elsewhere, Iraq’s crude oil production in July rose to the highest level since January, to 4.632 million barrels-per-day compared with 4.559 million bpd in June, state-run oil marketer SOMO said on Thursday.
Analysts believe that investors who buy oil when prices are down also contributed to the price hike.
A slide in US equities also forced USA crude futures, which plunged below the $40 level on Monday for the first time since April, to give back early gains of as much as 2 percent, traders said.
Brent crude futures for October delivery rose 31 cents to $42.11 a barrel, a 0.7 percent gain.
“We expect to see a little bit of price consolidation from here but our target really is for $35 WTI, which means any rebound you get will be more of a bear market correction”, said Matthew Tuttle, chief executive of Tuttle Tactical Management in Riverside, Connecticut. Factions in Libya reached a deal to re-open oil terminals, and Nigeria restarted payments to former militants as the government seeks a cease-fire, addressing some grievances amid attacks that cut crude production close to a 30-year low. Oil has entered a new bear market, plunging more than 20 percent since hitting $51.23 on June 8.
The dollar fell to a six-week low against a basket of currencies on Tuesday due to expectations the Fed would delay raising interest rates after recent soft USA economic data, Singapore’s United Overseas Bank said.
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Oil traded near a four-month low in NY on signs the global supply surplus persists even as stockpile declines in the USA pare the excess.
