Oil edges up on falling US crude stocks, but global glut weighs
SINGAPORE: Oil prices edged up on Wednesday, lifted by declining US crude inventories, although markets were still restrained by general oversupply.
Market focus was turning to the release of official US Energy Information Administration data later on Wednesday for a further update on inventories.
Brent crude futures LCOc1 were at $51.06 per barrel at 0651 GMT, up 23 cents, or 0.45 per cent, from their last close.
Traders said that reports of a dip in Libyan output to between 130,000 and 150,000 barrels per day (bpd), down from 280,000 bpd, had supported Brent. US West Texas Intermediate (WTI) crude futures CLc1 were at $47.71 a barrel, up 16 cents, or 0.3 per cent.
US crude inventories fell by 9.2 million barrels in the week to August 11 to 469.2 million, industry group the American Petroleum Institute said on Tuesday.
That compared with analyst expectations for a decrease of 3.1 million barrels.
“The market took this as a mildly bullish report,” said William O’Loughlin of Australia’s Rivkin Securities.
However, gasoline stocks climbed by 301,000 barrels, compared with analyst expectations for a 1.1 million barrel decline. More broadly, analysts said ample supplies were preventing prices from moving much higher.
“Excessive supply... is continuing to weigh on oil prices... Not a lot has changed despite the Opec and Russia efforts recently. While these producers have tried to limit their oil output, US shale oil continues to rise,” said Fawad Razaqzada, analyst at futures brokerage Forex. com.
The Organization of the Petroleum Exporting Countries together with non-Opec producers like Russia has pledged to restrict output by 1.8 bpd between January this year and March 2018.