SINGAPORE: Oil prices rose on bargain-buying in Asia on Friday but analysts warned of fresh selling pressure as the United States and the eurozone prepare to release key manufacturing indicators later in the day.
The gains extended a slight recovery on Thursday after they were hammered Wednesday by data showing US crude stockpiles had increased much more than expected last week, adding to worries about a global glut.
Prices have been depressed for more than a year by global oversupply and a slowdown in major economies, particularly China, the world’s top energy consumer.
US benchmark West Texas Intermediate for delivery in December was up 20 cents to $45.58 and Brent crude for December gained 39 cents to $48.47 at around 6:45 a.m. local time.
“We’re still seeing some bargain-hunting,” said Daniel Ang, an investment analyst with Phillip Futures in Singapore.
Ang said, however, he expected the US and European purchasing managers indexes on manufacturing activity—closely watched measures of the health of the industrial sector—to show weakness.
“The data will likely put a more bearish tone on oil prices,” he told Agence France-Presse, citing the European Central Bank’s hints Thursday that it could ramp up its bond-buying stimulus program at its December policy meeting.