Futures for May delivery added as much as 0.8 percent in New York after falling 0.4 percent Wednesday. Speculation that refiners will increase oil purchases and reduce U.S. crude supplies grew after data Wednesday showed gasoline stockpiles slid a fifth week to the lowest since January and distillates dropped a sixth week to the least since December.
Oil dipped below $50 a barrel this month for the first time in 2017 as swollen U.S. inventories and rising American production weighed on output cuts by the Organization of Petroleum Exporting Countries and other producers. While OPEC won’t decide until May whether to prolong the curbs, officials will meet this weekend in Kuwait to discuss their deal’s progress.
“Oil trading around $48 a barrel seems to be the new range, and it will return to the old range above $50 a barrel if OPEC decides to extend its output deal,” said Hong Sung Ki, a commodities analyst at Samsung Futures Inc. in Seoul. “Concerns over growing crude stockpiles in the U.S. are easing, considering reductions in refined fuel inventories.”
West Texas Intermediate for May delivery rose as much as 40 cents to $48.44 a barrel on the New York Mercantile Exchange and was at $48.28 at 7:55 a.m. in London. Total volume traded was about 49 percent below the 100-day average. The contract dropped 20 cents to $48.04 on Wednesday.
Brent for May settlement gained as much as 39 cents, or 0.8 percent, to $51.03 a barrel on the London-based ICE Futures Europe exchange. Prices on Wednesday traded below $50 for the first time since Nov. 30. The global benchmark traded at a $2.57 premium to WTI.
U.S. gasoline inventories fell by 2.8 million to 243.5 million barrels, data from the Energy Information Administration showed. Stockpiles of distillate fuel, a category that includes diesel and heating oil, declined to 155.4 million barrels. Crude supplies climbed by 4.95 million to 533.1 million barrels last week.
- Libya’s crude production has risen back to the level before clashes disrupted output three weeks ago and forced the OPEC nation’s two biggest oil ports to halt shipments.
- Algeria’s state-run energy producer plans to boost crude oil output by 14 percent in the four years to 2019 and invest billions of dollars in exploration projects.