Oil prices have increased marginally, recovering from the dip witnessed on Wednesday as a result of soaring US crude production and inventories.
The recovery comes on the back of ‘healthy’ demand and the US crude stockpiles staying below levels expected by analysts.
Brent crude futures LCOc1 climbed 12 cents, or 0.2%, trading at $64.46 per barrel, while US West Texas Intermediate (WTI) crude futures CLc1 increased by 11 cents, or 0.2%, to touch $61.26 a barrel, according to Reuters.
Both the futures declined more than 2% the previous day.
Futures brokerage Forex.com market analyst Fawad Razaqzada was quoted by the news agency as saying: “Oil prices bounced back immediately after the release of the weekly oil inventories data from the Energy Information Administration, where the headline figure was better than expected.”
Based on data from the EIA, US crude inventories C-STK-EIA increased by 2.4 million barrels in the week ending 2 March, to 425.91 million barrels.
Analysts forecasted the stockpile levels to increase by less than the 2.7 million barrel.
Meanwhile, the demand side is poised to grow at a healthy rate.
US bank Goldman Sachs was quoted by the news agency as saying: “A still robust growth outlook for 2018 and the recent pattern of 2Q demand acceleration all leave us reiterating our 1.85 million barrels of oil per day 2018 global oil demand growth forecast.”
However, growing US output continues to pose challenges to the efforts taken by the Organisation of the Petroleum Exporting Countries (OPEC) to prop up prices.