Oil prices bounced back in Asia today as investors weighed a rise in US crude inventories and production against a forecast by OPEC’s chief of rising demand.
US benchmark West Texas Intermediate crude for November delivery climbed 23 cents to $48.04 and Brent crude for November delivery gained 21 cents to $51.54 in late-morning Asian trade.
Prices had tumbled yesterday after a US Department of Energy report showed commercial crude stockpiles rose more than expected in the week ending October 2, indicating softer demand in the world’s top oil consuming nation.
Stockpiles rose by 3.1 million barrels, more than the market estimate of 2.25 million barrels. That brought inventories to 461.0 million barrels, more than 27 per cent higher than a year ago.
US production, which had fallen by 40,000 barrels per day in the previous week, unexpectedly surged by 76,000 barrels per day, dousing hopes of an easing in the global crude oversupply.
Traders, however, were also weighing remarks by Abdalla Salem El-Badri, secretary-general of the Organization of the Petroleum Exporting Countries, that demand will rise more than projected this year.
“World oil demand is estimated to increase by 1.5 million barrels per day in 2015, higher than the initial projection,” El-Badri said in a statement to the International Monetary Fund (IMF).
“In 2016, improvement in global economic activities is anticipated to support world oil demand to grow by 1.3 million barrels per day.”
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