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Oil takes a breather after rallying to 6-week highs

Published 20/07/2017, 08:47
© Reuters.  Oil catches breathe after big rally
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Investing.com - Oil prices were a bit lower in European trade on Thursday, pausing for breath after rallying to the highest level in around six weeks in the prior session.

The U.S. West Texas Intermediate crude September contract was at $47.26 a barrel by 3:45AM ET (0745GMT), down 8 cents, or around 0.2%. It touched its highest since June 7 at $47.46 in the prior session.

Elsewhere, Brent oil for September delivery on the ICE Futures Exchange in London dipped 4 cents to $49.66 a barrel, after touching a peak of $49.81 a day earlier.

Oil prices finished higher on Wednesday, after data from the U.S. Energy Information Administration showed a large drop in domestic crude and gasoline supplies.

U.S. oil inventories fell by 4.7 million barrels at the end of last week to 490.6 million barrels, more than the expected drop of around 3.2 million barrels.

The report also showed that gasoline inventories decreased by 4.4 million barrels, compared to expectations for a much more modest decline of 0.7 million barrels.

Despite recent gains, concerns over rising global supplies remained on investors' minds.

A ministerial committee from OPEC and non-OPEC countries, which is headed by Gulf OPEC member Kuwait, will meet in Russia on July 24 to discuss compliance with the cartel's deal to cut production.

In May, OPEC and some non-OPEC producers extended an agreement to slash 1.8 million barrels per day in supply until March 2018. So far, the agreement has had little impact on global inventory levels due to rising supply from producers not participating in the accord, such as Libya and Nigeria.

Elsewhere on Nymex, gasoline futures for August was down around half a cent to $1.612 a gallon, while August heating oil held steady at $1.555 a gallon.

Natural gas futures for August delivery tacked on 0.5 cents to $3.071 per million British thermal units, as traders looked ahead to weekly storage data due later in the global day.

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