Investing.com - Crude oil prices rebounded in Asia on Friday from a sharp overnight selloff on growing supply as investors look ahead to U.S. rig count data from Baker Hughes.
On the New York Mercantile Exchange, WTI crude for May delivery jumped 2.07% to $38.03 a barrel. Brent crude climbed 1.57% to $40.05 a barrel.
Overnight, crude futures fell sharply on Thursday, erasing some of their massive gains from the previous session, as energy traders reacted to reports of a considerable inventory build at the Cushing Oil Hub and an unexpected increase among exports in Iraq.
It came one session after domestic crude futures surged more than 5% following reports of a significant draw in U.S. crude stockpiles last week.
On the Intercontinental Exchange (ICE), Brent crude for June delivery wavered between $38.71 and $40.28 a barrel, before closing at $39.45, down 0.39 or 0.98% on the trading day.
Crude prices gave back some of their gains from the prior session on Thursday morning after energy services provider Genscape, Inc., reported a weekly build of 255,804 at Cushing through April 5. Cushing, the nation's largest storage facility, is the main delivery point for NYMEX oil. The marked increase came in spite of reports that TransCanada Corp. halted a 590,000 barrel per day transfer last Saturday through the Keystone crude pipeline.
Stockpiles at Cushing are perilously close to reaching full storage capacity at 65 million barrels.
One day earlier, the Energy Information Administration (EIA) reported a nationwide inventory draw of 4.94 million barrels for the week ending on April 1, sharply below consensus estimates of a build of 2.85 million barrels.
At 529.9 million barrels, U.S. crude oil inventories are at historically high levels for this time of year. U.S. output, meanwhile, fell 14,000 barrels last week to 9.008 million barrels per day, dipping to its lowest level in 17 months. By comparison, U.S. production stood at a 40-year low at 9.6 million bpd as recently as 10 months ago.
Elsewhere, traders digested bullish reports from the Iraqi state-run South Oil Company, which said Thursday that exports from the nation's Southern Iraq port increased to 3.494 million bpd for the first week of April. Exports from the port for the month of March lingered around 3.286 million bpd. Iraq has ramped up production considerably since January, 2012, when it pumped approximately 2.5 million bpd.
Crude oil prices have plunged more than 40% since November, 2014, when OPEC roiled global energy markets with a strategic decision to maintain its production ceiling above 30 million barrels per day. Ever since, global supply has outpaced demand by roughly 1 million bpd. Oil prices are expected to remain relatively flat until a closely-watched meeting in Doha on April 17, when Russia, Saudi Arabia and two other OPEC producers could freeze production at their respective levels from January.
Analysts from Goldman Sachs Group Inc (NYSE:NYSE:GS) expressed skepticism earlier this week that a coordinated output freeze can be reached at the meeting. Instead, Goldman analysts predicted that OPEC production will increase by 600,000 bpd this year. The analysts would not be surprised if global crude prices remained around $35 a barrel by year's end.