London: Oil rose, paring a second weekly loss, as strong Chinese crude imports allayed concerns that US markets may remain oversupplied.
Futures climbed 1.4 per cent in New York, paring this week’s loss to 1.5 per cent. China’s crude oil imports rebounded from a one-year low to near a record amid signs the nation’s commercial stockpiles shrank by the most in almost eight years. US crude output increased to a record last week, while motor fuel inventories rose more than double analysts’ forecasts, government data showed on Wednesday.
Oil has averaged about $54 (Dh198) a barrel this quarter, the highest in more than two years as the Organisation of Petroleum Exporting Countries (Opec) and its allies agreed to extend output curbs until the end of 2018. Chevron Corp. will ramp up investment in the US Permian Basin and other shale fields next year while reducing spending elsewhere, according to a statement Thursday.
“A recovery in Chinese imports is probably settling a few nerves,” said Ole Sloth Hansen, head of commodity strategy at Saxo Bank A/S in Copenhagen. Overall, “the focus is switching back from the Opec-cut extension, to US stocks, production and rig count.”
West Texas Intermediate for January delivery was at $57.46 a barrel on the New York Mercantile Exchange, up 77 cents, at 12.18pm in London. Total volume traded was about 5 per cent below the 100-day average. Prices gained 73 cents, or 1.3 per cent, to $56.69 on Thursday.
Brent for February settlement rose 82 cents to $63.02 a barrel on the London-based ICE Futures Europe exchange after climbing 1.6 per cent on Thursday. Prices are down 1 per cent this week. The global benchmark traded at a premium of $5.48 to February WTI.
US crude production expanded for a seventh week to 9.7 million barrels a day, the highest level in weekly data compiled by the Energy Information Administration since 1983. Gasoline inventories rose by 6.78 million barrels last week, the biggest gain since January.
