Crude futures rose on Wednesday for the first time in eight days, with U.S. oil pulling further away from the widely watched $30-per-barrel level breached the previous session, after U.S. crude stocks unexpectedly fell last week.
U.S. West Texas Intermediate crude (WTI) CLc1 was up 37 cents at $30.81 a barrel at 0608 GMT (1.08 a.m. ET). On Tuesday, it fell 97 cents to close at $30.44 a barrel, after touching a low of $29.93, which was last seen in December 2003.
Brent crude LCOc1, the global benchmark, was up 28 cents at $31.14 a barrel. The contract fell 69 cents to settle at $30.86, after bottoming at $30.34, on Tuesday.
The $30 mark is both a psychological and financial threshold and, in recent days, traders have poured money into $30 put options for expiration in February and March.
“$30 may be intermediate support but I really honestly can’t say whether this is the bottom,” said Avtar Sandu, senior commodities manager at Phillip Futures in Singapore.
“We see a bounce off here … but a change in trend is not visible yet,” he said.
In a bullish sign for oil, Chinese crude imports rose to a record 7.82 million barrels in December, up more than 21 percent from November, official data showed on Wednesday.
The world’s second biggest oil consumer has been taking advantage of the oil price rout to stock reserves and increase exports of refined products and may be set to overtake the U.S. as the world’s largest importer.
U.S. crude stocks fell by 3.9 million barrels in the week to 480.071 million, compared with analysts’ expectations for an increase of 2.5 million barrels, data from industry group the American Petroleum Institute showed on Tuesday. <API/S>
Crude stocks at the Cushing, Oklahoma, delivery hub for WTI fell by 302,000 barrels, API said.
But the bearish outlook for oil remains after the U.S. government forecast on Tuesday that the global glut will swell until late 2017.
Increased Iranian oil output should feed into oversupply this year with the expected lifting of Western sanctions on that country’s exports, the U.S. Energy Information Administration said.
The agency forecast that a limited decline in U.S. supplies next year and steady growth in global demand will help ease the glut only in the third quarter of 2017, the first decline after nearly four straight years of gains.
Still, in a reminder that geopolitical tensions could intervene to support prices, Iran is holding 10 U.S. sailors after seizing two Navy boats that allegedly entered Iranian waters in the Gulf on Tuesday.