Oil prices trim losses after US stocks report
Global oil prices fell Wednesday but trimmed earlier losses after signs of stronger-than-expected demand in top crude consumer the United States, analysts said.
Brent North Sea crude for delivery in May dipped 51 cents to $105.72 per barrel in late afternoon deals in London.
New York's main contract, West Texas Intermediate (WTI) light sweet crude for May shed 25 cents to $93.95.
The US government's Energy Information Administration (EIA) revealed Wednesday that American crude reserves grew 250,000 barrels in the week ending April 5.
That was far less than market expectations for a large gain of 1.2 million barrels, according to analysts polled by Dow Jones Newswires, and indicated solid demand.
"WTI was in the spotlight today with the weekly government EIA report on petroleum stocks showing a lower-than-expected rise in crude stockpiles," said analyst Michael Hewson at CMC Markets.
"However, this was not enough to turn prices positive on the day following the combined impact of an OPEC report on global oil demand predicting a rise by only 800,000 barrels this year, down 40,000 from last month's estimate, and the industry-funded American Petroleum Institute report that showed supplies rose by 5.06 million barrels last week."
OPEC kept its world oil demand forecasts for 2012 and 2013 virtually unchanged, with China expected to contribute the most to growth while industrialised countries appeared to be heading for a decline.
The Organisation of Petroleum Exporting Countries (OPEC) expects world demand to reach 88.87 million barrels per day (mbpd) this year, slightly higher than its previous forecast in March of 88.83 mbpd.
This would represent a hike of 770,000 bpd from the revised figure for 2011, the cartel said in its latest monthly report.
The EIA meanwhile added that US gasoline or petrol stockpiles rose 1.7 million barrels last week. That confounded estimates for a drop of one million barrels.
Torbjorn Kjus, oil market analyst at Oslo-based DNB Bank, said that the overall impression from the inventory report was "bearish", meaning that it would likely weigh on prices.
He added that gasoline demand was "weak", as stockpiles were normally expected to drop at this time of year.
Crude futures also trimmed losses after Federal Reserve meeting minutes suggested the central bank would curtail stimulus measures only if the job market improves significantly.
Minutes from the Fed's March 19-20 meeting reaffirmed the central bank's commitment to its quantitative easing program until the job markets improves.
The minutes showed policymakers slightly more inclined to reel in QE bond purchases this year amid signs of recovery in the labour market.
Kjus also noted that traders were still digesting a "mixed bag" of data from China, which is the world's biggest energy consuming nation.
"Overnight we had some mixed-bag Chinese trade figures which showed exports growth slowed in March to 10 percent compared to a year ago, while imports growth surged to 14.1 percent.
"However, imports of oil by the world's second largest economy fell 2.1 percent. This only helped to exacerbate demand worries which have come to the forefront recently following the release of some disappointing global economic data."
© 2013 AFP