Oil prices rose on Thursday, steadying after losses over the past two days from a surprise increase in US crude inventories and renewed concerns over trade friction between the US and China.
Brent crude futures were up 40 cents, or 0.6 per cent, at $72.79 a barrel by 0254 GMT, after dropping 2.5 per cent on Wednesday. US West Texas Intermediate (WTI) crude futures increased by 30 cents, or 0.4 per cent, to $67.96 a barrel. They fell 1.6 per cent in the previous session.
Oil prices are feeling the effects of ongoing tensions over global trade, with markets concerned about any slowdown in global growth. “A clear definition around the macros is what the market is looking for and until we get that, it is likely to be volatile in the range,” said Jonathan Barratt, chief investment officer at Ayers Alliance in Sydney.
US President Donald Trump has sought to ratchet up pressure on China for trade concessions by proposing a higher 25 per cent tariff on $200 billion worth of Chinese imports. China said it would hit back if the United States takes further steps on trade.
Brent prices fell more than 6 per cent in June and US crude slumped about 7 per cent, the biggest monthly declines for both benchmarks since July 2016. US crude inventories rose 3.8 million barrels last week as imports jumped, the government's Energy Information Administration said. Analysts polled by Reuters had expected a decline of 2.8 million barrels.
However, there were some bullish elements in the report. Gasoline stocks declined by 2.5 million barrels, while crude stocks at the Cushing, Oklahoma, delivery hub for WTI futures fell 1.3 million barrels, EIA data showed.
Brazilian oil exports hit a record in July, nearly three times its shipments in June and 50 percent higher than a year earlier, government data showed on Wednesday. Iraq exported 3.543 million barrels per day (bpd) of crude from its southern ports in July, slightly above the June average, the oil ministry said on Wednesday.
Russian oil production last month was on average above the level Moscow promised following the Organization of the Petroleum Exporting Countries and non-OPEC meeting in June, energy minister Alexander Novak indicated on Wednesday. Novak said that higher production was needed to maintain the market's stability.