Oil prices fluctuated between gains and losses on Tuesday as investors awaited more signs that a global glut of crude is easing.
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Light, sweet crude for September delivery gained 36 cents, or 0.8%, to $47.73 a barrel on the New York Mercantile Exchange, reversing losses after trading as low as $47.20 earlier in the session. Brent, the global benchmark, rose 50 cents, or 1%, to $52.16 a gallon.
News that Libya's largest oil field shut down again on protests sparked a rally in oil prices Tuesday morning, market participants said. Rising production in Libya has been one cause for concern among oil bulls, since the country is exempt from a deal among major producers to curb output through March 2018.
"That is a key point in the upside movement this morning," said Tony Headrick, an analyst at CHS Hedging.
The Organization of the Petroleum Exporting Countries have struggled to fully adhere to planned production cuts in recent months, keeping oil prices subdued. However, declining U.S. stockpiles of crude oil have boosted hopes that the oversupplied market is moving back toward balance.
The market is anticipating a further reduction in U.S. stocks when the American Petroleum Institute, an industry group, releases preliminary data for last week on Tuesday afternoon, said Ehsan Ul-Haq, a director at energy consultancy Resource Economist Ltd. That set of data will be followed by weekly official data from the U.S. Energy Information Administration on Wednesday.
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The EIA said last week that crude inventories had been reduced by 9 million barrels in the week ended Aug. 11, bringing the total drawdown since March to 69 million barrels.
However, analysts have cautioned the decline in inventories could be partly reversed after the busy summer driving season ends and the refinery maintenance period gets under way in autumn.
"With the U.S. summer driving season drawing to an end and refinery turnarounds fast approaching, there may be some unpleasant surprises in store for oil bulls," said Stephen Brennock, an analyst at oil brokerage PVM Oil Associates, in a report Tuesday morning.
Gasoline futures rose 1.1% to $1.6019 a gallon and diesel futures rose 1.5% to $1.5954 a gallon.
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(END) Dow Jones Newswires
August 22, 2017 11:59 ET (15:59 GMT)