TOKYO- Oil prices rose on Wednesday, recovering from six-month lows hit the previous day, as a larger-than-expected drop in US oil and gasoline stocks reminded investors that demand remains firm, if overshadowed by the prospect of a global recession.
Brent crude futures rose 13 cents, or 0.1 percent, to $92.47 a barrel by 0035 GMT. West Texas Intermediate (WTI) crude futures climbed 27 cents, or 0.3 percent, to $86.80 a barrel.
The contracts slumped about 3 percent on Tuesday as weak US housing starts data spurred concerns about a potential global recession.
“A drawdown of US gasoline stockpiles for a second straight week has reassured investors that demand is resilient, prompting buys,” said Kazuhiko Saito, chief analyst at Fujitomi Securities Co Ltd.
“Still, the oil market is expected to stay under pressure, with fairly high volatility, due to worries over a potential global recession,” he said.
US crude and fuel stocks fell in the latest week, according to market sources citing American Petroleum Institute figures on Tuesday.
Crude stocks fell by about 448,000 barrels for the week ended Aug. 12. Gasoline inventories fell by about 4.5 million barrels, while distillate stocks fell by about 759,000 barrels, according to the sources.
An extended Reuters poll showed on Tuesday that crude inventories likely dropped by around 300,000 barrels last week and gasoline stockpiles likely fell 1.1. million barrels, while distillate inventories rose. EIA/S
Investors also awaited clarity on talks to revive the 2015 Iran nuclear deal. Oil supply could rise if Iran and the United States accept a proposal from the European Union, which would remove sanctions on Iranian oil exports, analysts said. – Reuters