Oil prices rose on Thursday, recouping some of the heavy losses in the previous session, on signs of easing trade tensions between Washington and Beijing and a fall in U.S. crude stockpiles to their lowest in nearly a year.
Brent crude futures LCOc1 rose 23 cents, or 0.4 per cent to $61.04 a barrel by 0650 GMT.
U.S. West Texas Intermediate (WTI) futures CLc1 was up 28 cents, or 0.5 per cent, to $56.03 a barrel.
The rise came after China moved to exempt some U.S. anti-cancer drugs and other goods from tariffs and U.S. President Donald Trump announced a delay to scheduled tariff hikes on billions of dollars’ worth of Chinese goods.
The concessions preceded a planned meeting in coming days aimed at defusing the trade row between the world’s two largest economies.
`The postponement of the next round of China tariffs by President Trump … has the global growth story back in full swing,’’ said Jeffrey Halley, Senior Market Analyst at OANDA.
That said, “further rallies in Asia look limited today’’ ahead of the European Central Bank (ECB) rate review, he said.
The ECB meets later on Thursday and is expected to ease policy to support flagging growth.
The price rise on Thursday came after both of the principal global benchmarks fell sharply on the previous day following a report that President Trump had weighed easing sanctions on Iran, a move that would potentially boost global crude supply.
Boosting the market’s good mood, the U.S. Energy Information Administration said on Wednesday that U.S. crude oil stockpiles fell last week to their lowest in nearly a year, as refineries raised output and imports fell.
“Historical inventory patterns suggest that stocks should begin to hit seasonal bottom sometime in the next two-three weeks,’’ said Stephen Innes, Asia Pacific Market Strategist at AxiTrader.
Crude inventories fell for a fourth week, falling 6.9 million barrels in the week to Sept. 6 – more than double analysts’ expectations of a 2.7 million barrel drawdown.
At 416.1 million barrels, U.S. crude oil inventories were at their lowest since October 2018 and about two per cent below the five-year average for this time of year, the EIA said.
Crude stocks at the Cushing, Oklahoma delivery hub fell 798,000 barrels to 39.3 million barrels, their lowest since November 2018.
Refinery crude runs rose by 114,000 bpd, EIA data showed.
Refinery utilisation rates rose by 0.3 percentage point to 95.1 per cent of capacity.