Oil prices were steady on Thursday as an unexpected build in U.S. gasoline inventories offset a higher than forecast draw in crude stocks.
Brent crude for August delivery LCOc1 was up 2 cents at $63.51 a barrel by 0648 GMT (0248 EDT), after ending the previous day down 96 cents, or 1.5 percent. The benchmark rose 22 cents earlier in the session.
U.S. crude for delivery in August CLc1 was down 14 cents at $60.13 a barrel, after finishing Wednesday down 74 cents, or 1.2 percent.
“The market is disappointed with last night’s numbers,” said Mike McCarthy, chief market strategist at Sydney’s CMC Markets.
“The spread (between Brent and U.S. crude) had narrowed, so it’s not surprising it’s diverging.”.
The gap between Brent and West Texas Intermediate tightened towards $3 on Wednesday, but widened in Asian trade on Thursday.
UBS raised its average 2015 Brent crude price forecast on Thursday to $61.50 per barrel from $56.25 per barrel earlier, while it increased its average 2015 U.S. crude price outlook to $56 a barrel, up from $51.
Its revised 2016 forecasts are $70 per barrel for Brent and $67.50 per barrel for U.S. crude.
“For today, we continue to expect prices to move sideways with a strong resistance at $61.80 and $65 for West Texas Intermediate and Brent, and support at $59 and $62.38,” Phillip Futures said in a note on Thursday.
Vyanne Lai, an analyst at National Australia Bank said that oil had been trading in a very narrow range.
“Even though U.S. production has been slowing, the gap is filled by OPEC production,” she said.
U.S. gasoline stocks climbed 680,000 barrels to 218.49 million in the week to June 19, data from the U.S. Department of Energy’s Energy Information Administration showed on Wednesday. A Reuters poll had indicated a 304,000-barrel drop.
That was despite U.S. gasoline demand in the week to June 19 being at the highest level for the period since 1991 and a larger than expected fall in U.S. crude inventories.
U.S. crude stocks declined for the eighth straight week, by 4.9 million barrels to 462.99 million, in the week ending June 19, compared with analyst expectations of a 2.1 million barrel draw, the EIA said.
Source: Reuters
