Oil prices rose on Thursday after slumping in the early hours of Asian trade as concerns about global supply shortages outweighed the rise in US gasoline and distillate stockpiles.
For the more actively traded September, Brent crude futures rose 63 cents, or 0.6%, to $113.08 a barrel at 0250 GMT. The less liquid-traded August contract, which expires Thursday, was down 18 cents, or 0.2%, at $116.08.
West Texas Intermediate (WTI) crude futures rose 49 cents, or 0.5%, to $110.27.
Crude oil rose in early trading after a stockpile increase. The subsequent decline was due to refineries increasing their output amid higher refining margins.
Fuel stocks rose as refineries stepped up operations, operating at 95% of capacity, the highest for this time of year in four years.
U.S. Energy Information Administration (EIA) data showed that even as U.S. gasoline and distillate stockpiles climbed, crude inventories fell 2.8 million barrels in the week to June 24, beating analysts’ expectations for a 569,000-barrel decline.
With the suspension of shipments from Libya’s two major ports, there have been further cuts in supply which are supporting prices while production is said to have fallen due to ongoing protests in Ecuador. The spread of anti-government protests is hurting oil production.
However, concerns about slowing global economic growth continued to limit price increases. Recently, aggressive interest rate hikes by central banks and the slowdown in global economic growth put pressure on commodity markets.
By the way, the news that the US oil reserves will be released more and that OPEC will increase oil production also puts the oil market in upside expectations.
Another important factor limiting price increases is that the strong dollar makes oil more expensive for buyers using other currencies.
Meanwhile, the OPEC+ group, including Russia, began meetings on Wednesday, but sources said there was little chance of pumping more oil.
