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Brent, WTI oil futures rise 1% as Saudi comments support

Published 03/05/2015, 05:11 AM
Updated 03/05/2015, 05:11 AM
© Reuters.  Brent, WTI oil futures rise 1% as Saudi comments support

Investing.com - Crude oil futures rose on Thursday, after Saudi Arabian oil minister Ali al-Naimi said he expects prices to stabilize following a prolonged period of volatility late last year.

On the ICE Futures Exchange in London, Brent oil for April delivery tacked on 54 cents, or 0.88%, to trade at $61.09 a barrel during European morning hours.

On Wednesday, London-traded Brent prices dipped 47 cents, or 0.77%, to end at $60.55 a barrel.

Brent prices are up nearly 22% from a recent low of $47.68 hit on January 13 as some investors bet that a bottom had been reached after a seven-month long rout.

However, prices are still down approximately 47% since June, when futures climbed near $116.

Elsewhere, on the New York Mercantile Exchange, crude oil for delivery in April advanced 67 cents, or 1.3%, to trade at $52.20 a barrel, the most since February 20.

A day earlier, Nymex oil prices jumped $1.01, or 2%, to settle at $51.53 a barrel despite data showing that oil supplies in the U.S. rose to the highest level on record last week, exacerbating fears over a glut in supplies.

The U.S. Energy Information Administration said that U.S. crude oil inventories rose by 10.3 million barrels, compared to expectations for an increase of 4.0 million barrels.

Total U.S. crude oil inventories stood at 444.4 million barrels as of last week, the most in at least 80 years.

Meanwhile, the spread between the Brent and the WTI crude contracts stood at $8.89 a barrel, compared to $9.02 by close of trade on Wednesday.

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Oil prices have fallen sharply in recent months as the Organization of Petroleum Exporting Countries resisted calls to cut output, while the U.S. pumped at the fastest pace in more than three decades, creating a glut in global supplies.

Elsewhere, investors awaited the conclusion of the European Central Bank's monthly policy meeting later in the session as well upcoming data on U.S. employment.

ECB President Mario Draghi was expected to shed more light on how the bank will implement its €1.1 trillion quantitative easing program, which is due to start this month.

Traders also looked ahead to the release of the latest U.S. nonfarm payrolls report on Friday, for further indications on the strength of the recovery in the labor market.

Market analysts expect the data to show that the U.S. economy added 240,000 jobs in February, slowing from a gain of 257,000 in January, while the unemployment rate was forecast to decline to 5.6% from 5.7%.

The U.S. dollar index, which measures the greenback’s strength against a trade-weighted basket of six major currencies, was up 0.25% to 96.22 early on Thursday, the highest level since September 2003.

The greenback remained supported amid expectations for higher interest rates in the U.S. as early as June.

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