Oil prices claw back ground after sharp drop

Oil prices regained some ground on Thursday after steep losses the previous day, with a slight drop in US crude inventories stoking hopes that a push to rein in global oversupply could be gathering at least some momentum.

Brent crude futures were at $53.31 per barrel at 0108 GMT, up 38 cents, or 0.72 percent, from their last close.
US West Texas Intermediate (WTI) crude futures had risen 31 cents, or 0.61 per cent, to $50.75 a barrel.

Traders said that the gains came on the back of a reduction in commercial US crude stocks, which fell by 1 million barrels last week to 532.34 million barrels, according to the US Energy Information Administration (EIA). "However, that level was still near a record high.

Price increases came after both crude benchmarks fell over 3.5 per cent the previous day following a report of surging gasoline inventories as well as another rise in US crude oil production to 9.25 million barrels per day (bpd), up almost 10 per cent since mid-2016".

US gasoline stocks posted a counter-seasonal build of 1.5 million barrels, despite heavier refining activity.

"The US has now entered a seasonal period in which stockpiles are reduced during the summer driving season, hence the unexpected miss weighed heavily on prices," James Wood, investment analyst with Rivkin Securities, said in a note.