SINGAPORE: Oil rebounded from an overnight dive in Asian trade on Wednesday as data showing stronger US energy demand outweighed assurances of a supply boost by Saudi Arabia, analysts said.
New York's main contract, light sweet crude for delivery in May, rose 49 cents to $106.56 in the afternoon and Brent North Sea crude for May delivery advanced 36 cents to 124.48.
The impact of a boost in output by Saudi Arabia the world's largest crude exporter -- took a backseat to forecasts issued by the American Petroleum Institute showing a fall in US crude inventories, analysts said.
"The market is primarily reacting to the unofficial report issued by the American Petroleum Institute," said Victor Shum, senior principal of Purvin and Gertz energy consultants in Singapore.
"Their report indicates that crude inventories came down by 1.4 million barrels last week, and so that piece of news is causing oil to rebound after the sharp drop," he told AFP.
The United States is the world's largest oil consumer, and a dip in its stockpiles indicates an increase in energy demand, which would shore up prices.
Saudi Arabia's statement that it was ready to help stabilise the market by making up for a supply shortfall to compensate for lost Iranian output due to Western sanctions on Tehran had pushed oil prices lower.
The assurances to boost output come as the international community ramps up sanctions on Iran -- the world's fourth-largest oil producer -- in an effort to halt its nuclear activities, which Iran insists are for peaceful purposes only.
Comments
Comments are closed.