Investing.com - Crude oil rebounded in Asia on Thursday after a surprise drop reported by an industry group in U.S. inventories that aided sentiment on supply and demand coming into better balance.
On the New York Mercantile Exchange crude futures for March delivery rose 0.82% to $54.03 a barrel, while on London's Intercontinental Exchange, Brent gained 0.21% to $56.27 a barrel.
Crude stocks posted a surprise drop last week, the American Petroleum Institute (API) said late Wednesday, down 884,000 barrels, compared to a gain of 3.475 million barrels expected at the end of last week and breaking a trend of six-straight builds.
Gasoline inventories dipped 893,000 barrels, compared to the decline of 888,000 barrels seen and distillates dropped a sharp 4.23 million barrels, more than the drop of 483,000 barrels expected. The oil storage hub of Cushing, Oklahoma, saw a draw of 1.73 million barrels, the sixth decline in seven weeks.
Official figures from the Energy Information Administrtationa re due on Thursday, witht he API estimates leading to analyst revisions on expectations.
Overnight, crude settled more than 1% lower, despite a late slump in the dollar, after the release of the Federal Reserve Open Committee (FOMC) minutes in which the signal for a rate cut "fairly soon" was loud and clear.
Despite the tick lower in global oil prices, crude futures remained near their 52-week high of $55.24, as positive comments from OPEC support prices amid hopes that OPEC may cut production further in an effort to combat the supply glut in the industry.
Speaking at the International Petroleum Week conference in London, Barkindo estimated that OPEC member states are about 90% in compliance with a global pact to cut production and noted the willingness of non-OPEC members to comply with the deal.
Mr. Barkindo’s comments were supported by an OPEC report last week, which revealed that OPEC and other producers, including Russia, were in high compliance with last year’s agreed production cut.
In November last year, The OPEC and other producers, including Russia agreed to cut output by about 1.8 million barrels per day (bpd) in an effort to combat the oversupply issue that has pressured prices over the last two years.
Last week’s batch of U.S. energy reports from both the Energy information Agency (EIA) and oilfield services provider Baker Hughes, revealed a rise in U.S. crude inventories to record levels and an increase in the number of active U.S. rigs drilling for oil, respectively.