Oil prices edged up on Wednesday after an industry group said U.S. crude supplies fell by nearly 6 million barrels last week.
The American Petroleum Institute, however, brought mixed news, estimating that gasoline stockpiles increased again, adding to inventory levels that are already high for this time of the year.
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Analysts believe that Wednesday's price rebound will be short lived, given the Energy Information Administration on Tuesday boosted its U.S. oil-production forecasts. The EIA now sees depressed oil prices at least through next year, saying that new oil flowing out of Canada and Brazil will inundate an already oversupplied market.
The EIA will release official data on U.S. oil stocks and production later Wednesday.
Brent crude, the global oil benchmark, rose 0.84% to $49.14 a barrel on London's ICE Futures exchange. On the New York Mercantile Exchange, West Texas Intermediate futures were trading up 0.98% at $46.33 a barrel.
While the API and EIA currently have the spotlight, investors focus remains on the Organization of the Petroleum Exporting Countries and what this group might do to counter the anticipated gusher of new oil. The general expectation is that the cartel and Russia will roll current production cuts into the second half of this year, or possibly into early 2018.
The markets tepid reaction to OPEC's anticipated cuts has been a source of concern for analysts.
"The prices are still way below $50," said Eugen Weinberg, an analyst at Commerzbank. "It is a sign of relative weakness even as OPEC and Russia show commitment to continue with the [production cut] deal for six months and beyond."
Production is also recovering in OPEC members Libya and Nigeria. Any sharp increase of output from those two nations, which are exempt from the current output cuts, may add pressure on other OPEC producers to cut even more as the cartel tries to bring global crude inventories down to five-year averages.
Possibly also helping sentiment in trading on Wednesday is a Reuters' report that Saudi Arabia, which has taken on the lion share of the cuts, is planning to reduce oil exports to Asia by about 7 million barrels in June.
Nymex reformulated gasoline blendstock--the benchmark gasoline contract--rose 0.53% to $1.50 a gallon. ICE gasoil changed hands at $437.75 a metric ton, down $3.00 from the previous settlement.
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(END) Dow Jones Newswires
May 10, 2017 06:32 ET (10:32 GMT)