Investing.com - Crude prices gave up early gains in Asia on Thursday, but stayed in the black with sentiment focused on the pain point for U.S. shale driller is oil benchmarks continue to decline near to $40 a barrel.
On the New York Mercantile Exchange crude futures for August delivery rose 0.07% to settle at $42.56 a barrel, while on London's Intercontinental Exchange, Brent gained 0.04% to trade at $44.84 a barrel.
At the end of the week, oilfield services firm Baker Hughes will detail the state-of-play for U.S. oil drilling at the end of last week with 22 straight weekly gains already in place.
Overnight, crude futures bounced off their lowest level since August, but remained at seven-month lows as data showing that supplies of U.S. crude fell by more than expected failed to offset fears about the glut in supply.
An upbeat report from the Energy Information Administration on Wednesday, showing a dip in crude and gasoline stockpiles failed to lift sentiment on oil.
Inventories of U.S. crude fell by roughly 2.45m barrels in the week ended June 16, below expectations of draw of about 2.1m barrels.
Gasoline inventories, one of the products that crude is refined into, unexpectedly fell by roughly 578,000 barrels against expectations of a rise of 443,000 barrels while distillate stockpiles rose by 1.1m barrels, compared to expectations of a rise of 465,000 barrels.
Crude prices have remained under pressure since the start of the week, reflecting the growing disbelief among traders in Opec and its allies’ ability to tackle the demand and supply balance in the market.
In May, OPEC and non-OPEC members agreed to extend production cuts for a period of nine months until March, but stuck to production cuts of 1.8 million bpd agreed in November last year.
During the last few sessions, several analysts have scaled back expectations of near-term crude prices, which have fallen more than 20% since January.
“Oil is in a downtrend and risks trending into the $30's,” Paul Ciana, a technical strategist at Bank of America Merrill Lynch (NYSE:BAC) said in a note on Tuesday.