LONDON: Brent hovered near $55 (£36) a barrel on Thursday after data showed U.S. crude stockpiles set a record for the fifth week in a row, renewing fears that supply is still far outpacing demand.
March Brent futures were up 62 cents to $55.28 a barrel at 0713 GMT, following a 3-percent loss in the previous session that saw prices break below $54 at one point.
U.S. March futures were trading up $1.09 at $49.93, after falling more than 2 percent in the previous session.
“For today, we should expect some recovery considering prices have been dropping,” said Daniel Ang of Phillip Futures in Singapore in a note, adding news of industry restructuring and lower oil rig counts had been temporarily pushing up prices, but crude production still hadn’t actually declined.
Brent prices have gained as much as 30 percent from a mid-January low of $45.19 a barrel, but the benchmark has been pulling back this week as evidence of a continuing glut mounts.
“It is difficult to declare with conviction that oil is back in a bull market,” Nomura analysts said in a note dated Feb. 11.
“It will probably take a few months for the reduction in energy capex budgets to be fully reflected into business activities,” the analysts said, referring to cuts in capital expenditures that would eventually reduce output.
On Wednesday, Saudi Arabia’s oil minister met with the chairman of Russian state-controlled energy giant Gazprom, Saudi state media said, and discussed cooperation between oil producers belonging to the Organization of Petroleum Exporting Countries (OPEC) and non-members like Russia.
