SINGAPORE Feb 7 Oil steadied on Tuesday after
falls the previous session, with markets torn between mixed
price indicators that have kept crude range-bound for much of
Brent crude futures, the international benchmark for
oil prices, were trading at $55.96 per barrel at 0151 GMT, up 24
cents from the last close.
U.S. West Texas Intermediate (WTI) crude futures were
up 20 cents at $53.21 a barrel.
The increases came after WTI and Brent fell 1.5 to 2 percent
the previous day.
Since the beginning of the year, both crude futures
benchmarks have remained within a $5 per barrel price range,
indicating a lack of strong directional price indicators.
Traders said key price support was coming from an effort by
the Organization of the Petroleum Exporting Countries (OPEC) and
other producers to cut output by almost 1.8 million barrels per
day (bpd) in the first half of 2017.
While OPEC and Russia have together cut at least 1.1 million
bpd so far, rising output elsewhere as well as signs of slowing
demand growth threaten to undermine these efforts, traders said.
"The number of oil rigs in the U.S. (is) now at the highest
level in 14 months, having risen over 20 percent since the OPEC
production cut agreement was reached," ANZ bank said on Tuesday.
Beyond rising drilling activity, there are also concerns
that U.S. gasoline consumption, a key pillar for crude oil
demand, is stalling.
Gasoline stockpiles rose by almost 21 million barrels during
the first 27 days of 2017, compared with an average increase of
less than 12 million barrels at the same time of year during the
previous decade, according to official inventory data, implying
either stalling demand or ongoing oversupply.
In China, which is challenging the United States as the
world's biggest oil consumer, BMI Research said this week that
crude oil import demand would soften during the first half of
the year as refinery maintenance results in less demand and as
independent refiners were given a lower annual crude import
(Reporting by Henning Gloystein; Editing by Joseph Radford)