Oil prices climbed on Thursday after dropping
around a dollar in the previous session on higher inventories.
Brent for December delivery rose 1.40% to $48.52 a barrel. The global crude benchmark finished down 86 cents, or 1.8 percent, on Wednesday, after hitting $47.50, its lowest since early October.
U.S. crude for December delivery climbed 1.39% to $45.84 a barrel, having settled down $1.09, or 2.4%, in the previous session. It hit a three-week low of $44.86 on Wednesday.
Oil prices came under fresh pressure caused by worries about a global surplus this week after U.S. crude inventories rose more than twice what analysts had expected. U.S. crude stocks surged steeply for a second week, climbing 8 million barrels in the week to Oct. 16, data from the U.S. Department of Energy's Energy Information Administration (EIA) showed on Wednesday.
That rise followed a jump of more than 7.5 million barrels in the previous week and put U.S. crude stocks up more than 22 million barrels over the last four weeks.
While U.S. oil inventories are 26% higher than last year, the EIA also said there were declines in stocks of gasoline and distillates, which include diesel, which mean a healthy demand for oil products. U.S. oil production remained stable from the previous week, EIA data showed, at about 9.1 million barrels a day, after peaking in April at 9.6 million barrels a day.
“We see some pickup in demand from refineries so this increase in demand somewhat compensates the huge increase in supply,” said Ole Hansen, head of commodity strategy at Saxo Bank.
Oil strategists from the Organization of the Petroleum Exporting Countries and non-member states made no agreement this week to take steps to boost prices, officials said after talks in Vienna on Wednesday.
In an effort to defend their market share, OPEC members, and other oil heavyweights have refused to slash production, despite the oversupply. The anticipated resumption of Iranian oil exports, most likely later this year, is also aggravating concerns of a longer global surplus and depressed prices.
