Crude futures steadied on Wednesday, recovering from the lows of the day, after a smaller-than-expected supply build in the United States and drop in the number of U.S. rigs actively drilling for oil.
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Traders and investors also appeared to be avoiding big new bearish positions in U.S. crude ahead of Thursday's market close for the Thanksgiving holiday, analysts said.
With 90 minutes to settlement, U.S. crude's West Texas Intermediate (WTI) futures had traded less than 300,000 lots, versus Monday's volume above 500,000, Reuters data showed. The lighter volume could have the potential to distort price moves, traders said.
WTI futures were down 15 cents at 42.72 a barrel by 1:39 p.m. EST (1839 GMT), after plumbing an intraday low at $41.72.
Benchmark Brent futures traded 25 cents lower at $45.87, having touched a session bottom of $45.03.
The U.S. Energy Information Administration said crude oil stocks across the country rose by 961,000 barrels last week. A preliminary inventory report by industry group American Petroleum Institute had anticipated a 2.6-million barrel rise while a Reuters poll of analysts forecast a 1.2 million build.
Oil services firm Baker Hughes said the U.S. oil rig count fell by nine this week. Oil drillers have cut rigs in 12 of the past 13 weeks, a sign they were still waiting for higher prices to return to the well pad, Baker Hughes data showed.
Not all oil-related data on Wednesday was positive, though.
The EIA said gasoline stockpiles rose by 2.5 million barrels, versus the 938,000-barrel build forecast in the Reuters poll.
Inventories of distillates, which include diesel and heating oil, rose by 1.0 million barrels, versus expectations for a 417,000 barrels drop.
While U.S. crude stocks as a whole rose by less than 1 million barrels, the Cushing, Oklahoma, delivery hub for WTI futures alone had a 1.74 million-barrel build, the EIA said. Big Cushing builds tend to have longer-term bearish impact on prices.
"We suspect rallies, if any, will be rather short-lived," said Tariq Zahir, a trader in crude oil spreads at Tyche Capital Advisors in Long Island, New York. (Additional reporting by Meeyoung Cho; Editing by William Hardy and Chris Reese)