Oil prices retreated Thursday as caution prevailed before central bank policy meetings in Europe and Japan.
At 1130 GMT, Brent North Sea crude for delivery in September declined 19 cents at $46.98 a barrel.
US benchmark West Texas Intermediate (WTI) for the same month nudged nine cents lower to $45.66 compared with Wednesday’s close.
Crude futures had rebounded Wednesday from two-month lows as markets reacted to a drop in US commercial crude inventories.
The government’s Department of Energy (DoE) reported that crude stockpiles fell by 2.3 million barrels last week.
That was the ninth successive weekly drop and offset a surprise rise in motor fuel inventories during the peak demand US summer driving season, when many Americans hit the roads for their vacation.
Falling US stockpiles tend to push oil prices higher because they indicate strengthening crude demand in top global consumer the United States.
“WTI crude has been on an unpredictable rollercoaster ride with prices casually swinging between losses and gains as a myriad of economic reports provide mixed signals,” said analyst Lukman Otunuga at traders FXTM.
“Prices edged higher on Wednesday, propelling US crude from the two month lows after a report which showed a ninth straight week of crude inventories draws.
“Regardless of these short gains, WTI is noticeably depressed and the lingering oversupply concerns could provide a foundation for another decline.”
Thursday’s advance was in line with a broad uptick across equities markets in Asia, which fuelled optimism about the outlook for the global economy as central banks and governments plan stimulus measures.
The European Central Bank will meet Thursday and while it is not expected to make any announcement yet, traders are hoping its boss Mario Draghi will promise to provide economies back-up in the event of any fallout from Britain’s decision last month to leave the EU.
That will be followed next week by a gathering of policymakers at the Bank of Japan, with speculation rife that it will further ease monetary policy while the government plans its own spending surge worth a reported 20 trillion yen ($186 billion).
Crude prices have fluctuated between $44 and $52 per barrel in the past month, after falling below $30 in February on the back of the world supply glut and weak demand.
Source: AFP
