Investing.com - Crude oil futures rallied more than 1% on Wednesday, as investors returned to the market to cover short positions ahead of the European Central Bank's monthly policy meeting on Thursday, at which it is widely expected to launch a government bond-buying program.
On the New York Mercantile Exchange, crude oil for delivery in March rose 75 cents, or 1.61%, to trade at $47.22 a barrel during U.S. morning hours.
A day earlier, New York-traded oil futures tumbled $2.66, or 5.41%, to settle at $46.47 a barrel. WTI prices touched $44.20 on January 13, a level not seen since March 2009.
Elsewhere, on the ICE Futures Exchange in London, Brent oil for March delivery tacked on 81 cents, or 1.7%, to trade at $48.81 a barrel.
On Tuesday, London-traded Brent prices fell 85 cents, or 1.74%, to close at $47.99 a barrel. Brent hit $45.19 on January 13, the weakest level since April 2009.
Oil prices have fallen nearly 60% since June 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.
Market participants looked ahead to fresh weekly information on U.S. stockpiles of crude and refined products to gauge the strength of demand in the world’s largest oil consumer.
The American Petroleum Institute will release its inventories report later in the day, while Thursday’s government report could show crude stockpiles rose by 2.5 million barrels in the week ended January 16.
The report comes out one day later than usual due to Monday's Martin Luther King, Jr. holiday in the U.S.
Elsewhere, the euro remained under pressure amid mounting expectations that the ECB will embark on an outright quantitative easing program on Thursday, in a bid to stave off the threat of deflation in the euro area.
The U.S. dollar index, which measures the greenback’s strength against a trade-weighted basket of six major currencies, declined 0.4% to 92.96.
Data released earlier showed that the number of building permits issued in the U.S. last month decreased by 1.9% to 1.032 million units from November’s total of 1.052 million.
Analysts expected building permits to rise by 1.3% to 1.055 million units in December.
The report also showed that U.S. housing starts rose by 4.4% last month to hit 1.089 million units from November’s total of 1.043 million units, compared to expectations for a reading of 1.040 million.