Investing.com - Crude futures rebounded from two-year lows on Friday on demand from bottom fishers, though gains were cautious on concerns a slumping global economy and a stronger dollar will dampen demand for the commodity going forward.
A stronger greenback makes oil a less attractive commodity on dollar-denominated exchanges, especially in the eyes of investors holding other currencies.
In the New York Mercantile Exchange, West Texas Intermediate crude oil for delivery in November traded up 0.20% at $85.94 a barrel during U.S. trading. New York-traded oil futures hit a session low of $83.62 a barrel and a high of $86.23 a barrel.
The November contract settled down 1.76% at $85.77 a barrel on Thursday.
Nymex oil futures were likely to find support at $83.33 a barrel, the low from July 3, 2012, and resistance at $91.79 a barrel, last Friday's high.
A stronger dollar coupled with concerns that slumping European and Asian economies will cut demand for crude has sent the commodity plummeting by around 18% since July, though by Friday after a rough week, oil prices rose on demand from bottom fishers.
Still, gains were cautious, as concerns persist that a stronger dollar, slumping demand outside of the U.S. and an abundance of global supply will spell further losses for crude down the road.
Crude also remained under pressure after the U.S. Energy Information Administration said in its weekly report on Wednesday that oil inventories rose by 5 million barrels in the week ending Oct. 3, blowing past expectations for a gain of 1.6 million barrels.
The report also showed that gasoline stockpiles rose by 1.2 million barrels, confounding expectations for a drop of 1.0 million barrels.
The data came a day after the American Petroleum Institute said that U.S. crude inventories increased by 5.1 million barrels in the week ending Oct. 3, more than expectations for a rise of 1.4 million barrels.
Separately, on the ICE Futures Exchange in London, Brent oil futures for November delivery were up 0.08% at US$90.13 a barrel, while the spread between Brent and U.S. crude contracts stood at US$4.19 a barrel.