Following an unexpected draw in weekly U.S. crude oil inventories and positive Chinese trade data gave investors reasons to buy crude futures, oil prices saw a rise for the first time in eight sessions on Wednesday.
At $31.76 a barrel, Brent crude, the global benchmark, was up 90 cents, nearly 3 percent, but remained near lows last seen nearly 12 years ago.
Recovering from Tuesday's dip below $30, U.S. West Texas Intermediate crude (WTI) was up 98 cents at $31.42 a barrel.
"The API inventory data triggered a profit-taking wave, that's the main reason for this uptick. But the overall sentiment is still negative, meaning downside risk is still greater than upside potential," said Hans van Cleef, senior energy economist at ABN Amro in Amsterdam.
Data from industry group the American Petroleum Institute showed on Tuesday that the U.S. crude stocks fell unexpectedly last week.
Compared with analysts' expectations for an increase of 2.5 million barrels crude inventories fell by 3.9 million barrels in the week to reach 480.071 million. The API said that the crude stocks at the Cushing, Oklahoma delivery hub fell by 302,000 barrels.
Official government data is expected to be released later on Wednesday.
The good news initially came from China which reported exports dipped just 1.4 percent in U.S. dollar terms in December. Analysts had made a forecast of an 8 percent drop. This bit of data positively surprised the world markets.
While almost set to overtake the United States as the world's largest importer, China, the world's second-biggest oil consumer, has also been taking advantage of the oil price rout to stock reserves and increase exports of refined products.
Currency markets were steadied and equities were boosted by the Chinese news. While the dollar rose 0.2 percent against a basket of other currencies, Britain's FTSE 100 index was up 1.25 percent.
However oil still carries a bearish outlook. A rise in demand for crude could be lower than previously expected, analysts at Morgan Stanley warned on Wednesday.
"Any slowing in the rate of demand growth could delay the timing of rebalancing and ultimately a price recovery," they said in a research note.
After Iran's oil minister was quoted as saying he had not received any request for a gathering of OPEC members, the potential for the calling of an emergency OPEC meeting also weakened on Wednesday.
A "couple" of OPEC members had asked for an emergency meeting, Nigeria's oil minister had said on Tuesday.
Earlier, Iran briefly detained a group of U.S. sailors after they entered Iranian waters days ahead of the expected implementation of a landmark nuclear accord between Tehran and world powers. However after determining they had entered Iranian waters by mistake, Iran released the sailors on Wednesday after holding them overnight.
(Source:www.reuters.com)
At $31.76 a barrel, Brent crude, the global benchmark, was up 90 cents, nearly 3 percent, but remained near lows last seen nearly 12 years ago.
Recovering from Tuesday's dip below $30, U.S. West Texas Intermediate crude (WTI) was up 98 cents at $31.42 a barrel.
"The API inventory data triggered a profit-taking wave, that's the main reason for this uptick. But the overall sentiment is still negative, meaning downside risk is still greater than upside potential," said Hans van Cleef, senior energy economist at ABN Amro in Amsterdam.
Data from industry group the American Petroleum Institute showed on Tuesday that the U.S. crude stocks fell unexpectedly last week.
Compared with analysts' expectations for an increase of 2.5 million barrels crude inventories fell by 3.9 million barrels in the week to reach 480.071 million. The API said that the crude stocks at the Cushing, Oklahoma delivery hub fell by 302,000 barrels.
Official government data is expected to be released later on Wednesday.
The good news initially came from China which reported exports dipped just 1.4 percent in U.S. dollar terms in December. Analysts had made a forecast of an 8 percent drop. This bit of data positively surprised the world markets.
While almost set to overtake the United States as the world's largest importer, China, the world's second-biggest oil consumer, has also been taking advantage of the oil price rout to stock reserves and increase exports of refined products.
Currency markets were steadied and equities were boosted by the Chinese news. While the dollar rose 0.2 percent against a basket of other currencies, Britain's FTSE 100 index was up 1.25 percent.
However oil still carries a bearish outlook. A rise in demand for crude could be lower than previously expected, analysts at Morgan Stanley warned on Wednesday.
"Any slowing in the rate of demand growth could delay the timing of rebalancing and ultimately a price recovery," they said in a research note.
After Iran's oil minister was quoted as saying he had not received any request for a gathering of OPEC members, the potential for the calling of an emergency OPEC meeting also weakened on Wednesday.
A "couple" of OPEC members had asked for an emergency meeting, Nigeria's oil minister had said on Tuesday.
Earlier, Iran briefly detained a group of U.S. sailors after they entered Iranian waters days ahead of the expected implementation of a landmark nuclear accord between Tehran and world powers. However after determining they had entered Iranian waters by mistake, Iran released the sailors on Wednesday after holding them overnight.
(Source:www.reuters.com)
