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U.S. oil futures bounce off 4-month low ahead of API supply data

Published 04/08/2015, 14:45
Updated 04/08/2015, 14:46
© Reuters.  WTI oil futures regain strength after hitting 4-month low
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Investing.com - U.S. oil futures rose for the first time in four session's on Tuesday to bounce off the lowest level in more than four months as traders looked ahead to weekly data on U.S. stockpiles of crude and refined products later in the day.

Crude oil for delivery in September on the New York Mercantile Exchange tacked on 78 cents, or 1.73%, to trade at $45.95 a barrel during U.S. morning hours.

On Monday, Nymex oil tumbled to $45.08, the weakest level since March 19, before closing at $45.17, down $1.95, or 4.14%.

The American Petroleum Institute will release its inventories report later in the day, while Wednesday’s government report could show crude stockpiles fell by 1.3 million barrels in the week ended July 31.

New York-traded oil futures dropped $12.22, or 21.24%, in July, the biggest monthly loss since October 2008, as worries over high domestic U.S. oil production weighed.

Industry research group Baker Hughes (NYSE:BHI) said Friday that the number of rigs drilling for oil in the U.S. increased by five last week to 664, the second straight weekly gain.

Elsewhere, Brent oil futures regained strength as investors returned to the market to seek cheap valuations after prices plunged more than 5% to a six-month low in the previous session.

On the ICE Futures Exchange in London, Brent oil for September delivery rose 55 cents, or 1.12%, to trade at $50.08 a barrel. A day earlier, London-traded Brent prices plunged to $49.36, a level not seen since January 27, before ending at $49.52, down $2.69, or 5.15%.

Brent futures tumbled $11.39, or 18.6%, last month, as ongoing worries over a global supply glut drove down prices.

Global oil production is outpacing demand following a boom in U.S. shale oil production and after a decision by the Organization of Petroleum Exporting Countries last year not to cut production.

Meanwhile, the spread between the Brent and the WTI crude contracts stood at $4.13 a barrel, compared to $4.35 by close of trade on Monday.

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