LONDON: Oil prices rose slightly on Thursday with some investors keen to buy at what they perceive to be bargain levels, but persistent gluts of crude and refined fuel kept gains slight.
Brent crude futures were up 23 cents at $44.37 a barrel by 0908 GMT.
International benchmark Brent is still down more than 10 percent this month and 22 percent this year, having slumped from as high as $115 in 2014.
"People are seeing oil at these very low levels and so they want to step in," said Hans van Cleef, senior energy economist at ABN Amro in Amsterdam.
"Some have a focus on an outlook for increased demand and a view that at some point the market will balance, but the oversupply is capping gains."
Any rise is seen as vulnerable, with Brent not having closed higher for two consecutive days since early October.
US crude futures last traded at $40.72 a barrel, down 3 cents from their last settlement. The contract fell below $40 for the first time since August on Wednesday.
Traders are preparing for another downward turn in prices by March 2016, market data suggests, as what is expected to be an unusually warm winter dents demand just as Iran's resurgent crude exports hit global markets after sanctions end.
Overall, oil markets remain oversupplied, with rising US stockpiles the most visible evidence.
Goldman Sachs said on Thursday there was still a downside risk to oil prices "as storage utilization continues to climb". The bank added that "we don't believe that current prices present an appealing entry point".
US crude inventories rose by 252,000 barrels last week to 487.3 million barrels, close to record highs, according to the Energy Information Administration, highlighting that more oil is being produced than is needed.
As a result, US crude futures have been struggling to break higher this week, although ANZ bank said rising crude demand from US refineries was also preventing prices from falling much further. Because of the glut, producers are scrambling to offer discounts in an effort to defend market share against their competition.
OPEC's second-biggest producer, Iraq, has started to sell some crude grades for as little as $30 a barrel, trade sources said, acting as a further drag on futures.
In the longer term, Saudi oil minister Ali al-Naimi said new investments were needed to meet future demand growth, although the chief executive of Kuwait Petroleum said it would take years for demand to catch up with supplies again.
Comments
Comments are closed for this article.