Oil prices claw up slightly amidst reported fall in US crude stocks

Singapore: Oil prices edged up on Thursday, clawing back some ground after losses in the previous session.

Traders said the market was range-bound as falling crude inventories provided price support while high output was capping gains.

Brent crude futures were at $50.44 per barrel at 0543 GMT, up 17 cents, or 0.3 percent, from their last close.

U.S. West Texas Intermediate (WTI) crude futures were at $46.84 a barrel, up 6 cents, or 0.1 percent.

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The slight gains followed a more than 1 percent fall in the previous session.

Energy Information Administration (EIA) data on Wednesday showed that commercial U.S. crude oil stocks C-STK-T-EIA have fallen by almost 13 percent from their peaks in March to 466.5 million barrels. Stocks are now lower than in 2016.

The soaring U.S. output undermines efforts by the Organisation of the Petroleum Exporting Countries which, together with non-OPEC producers like Russia, has pledged to restrict output by 1.8 million barrels per day (bpd) between January this year and March 2018.

Brent prices are down by almost 12 percent since the start of the cuts in January.

The subdued market sentiment also has roots on the demand side.

Oil producers have enjoyed years of rocketing demand, fuelled largely by China’s voracious thirst coming from over 2 million new car sales a month.

But this boom is coming to an end as its vehicle sales slow in a maturing market, and as cars become more efficient and start using alternative fuels.

 

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