Investing.com - Oil prices edged higher in North American trading on Wednesday, reversing earlier losses after data showed that U.S. crude supplies fell more than expected last week.
The U.S. West Texas Intermediate crude June contract tacked on 30 cents, or around 0.6%, to $49.87 a barrel by 10:35AM ET (14:35GMT). Prices were at around $49.25 prior to the release of the inventory data.
The U.S. benchmark settled higher for the first time in seven sessions on Tuesday after hitting its weakest level since March 29 at $48.87.
Elsewhere, Brent oil for July delivery on the ICE Futures Exchange in London added 26 cents to $52.83 a barrel after sliding to $51.30 in the prior session, its deepest trough since March 28.
The U.S. Energy Information Administration said in its weekly report that crude oil inventories fell by 3.6 million barrels in the week ended April 21.
Market analysts' expected a crude-stock decline of 1.6 million barrels, while the American Petroleum Institute late Tuesday reported a supply-gain of 897,000 barrels.
Supplies at Cushing, Oklahoma, the key delivery point for Nymex crude, decreased by 1.2 million barrels last week, the EIA said.
Total U.S. crude oil inventories stood at 528.7 million barrels as of last week, which the EIA considered to be at the upper limit of the average range for this time of year.
The report also showed that gasoline inventories increased by 3.4 million barrels, disappointing expectations for a drop 1.0 million barrels.
For distillate inventories including diesel, the EIA reported a gain of 2.7 million barrels.
Crude has been under heavy selling pressure in recent days amid fears that an ongoing rebound in U.S. shale production could derail efforts by other major producers to rebalance global oil supply and demand.
U.S. drillers last week added rigs for the 14th week in a row, data from energy services company Baker Hughes showed on Friday, extending a 10-month drilling recovery. That brought the total count to 688, the most since September 2015.
The increase in U.S. output has overshadowed pledged output cuts by major producers. In November last year, OPEC and other producers, including Russia agreed to cut output by about 1.8 million barrels per day between January and June, but so far the move has had little impact on inventory levels.
A final decision on whether or not to extend the deal beyond June will be taken by the oil cartel on May 25.
Elsewhere on Nymex, gasoline futures for June inched up 0.9 cents, or about 0.6%, to $1.617 a gallon, while June heating oil slipped 0.1 cents to $1.549 a gallon.
Natural gas futures for June delivery climbed 6.9 cents to $3.234 per million British thermal units.