Oil rose for a third day in New York amid low trading volumes, recouping most of this week’s earlier losses, yet the outlook remained clouded by concerns over the economy and abundant supplies.
West Texas Intermediate futures climbed as much as 1.2 per cent with little news to drive the increase and trading volumes about 70 per cent below average. Sentiment remained pessimistic, after China reported the slowest pace of economic growth since the early 1990s last quarter, and U.S. government data on Thursday showed that crude inventories expanded last week.
WTI for November delivery advanced 57 cents to US$54.50/bbl on the New York Mercantile Exchange as of 7:44 a.m. Eastern. It rose 1.1 per cent on Thursday. This week’s loss has been trimmed to 0.4 per cent.
Brent crude for December settlement gained 24 cents to US$60.15/bbl on the London-based ICE Futures Europe, paring its weekly drop to 0.6 per cent. The global benchmark was at a premium of $5.57 to WTI for the same month.
U.S. crude inventories rose by 9.3 million bbls in the week through Oct. 11, according to data from the Energy Information Administration, surpassing analyst estimates of a three million-bbl increase. Yet gasoline stockpiles fell by 2.6 million bbls, the most since August, and distillate stores shrank by 3.8 million bbls.
“The inventory build was significantly more pronounced than expected,” said Carsten Fritsch, an analyst at Commerzbank AG in Frankfurt.
China’s gross domestic product figures trailed estimates and added to a deteriorating global demand outlook for crude. With a drop-off in exports to the U.S. expected to continue due to the trade war, the Chinese economy is likely to keep struggling as deflationary pressures hit company profits.
© 2019 Bloomberg L.P.