Singapore: Oil prices turned higher on Wednesday but remained near faltering economy spurred heavy losses this week, analysts said.
US benchmark West Texas Intermediate for October delivery rose 28 cents to $39.59 and Brent crude for October added 29 cents to $43.50 in late-morning Asian trade.
Both contracts gained on bargain-hunting Tuesday, after plummeting to their lowest levels since early 2009 a day earlier as investors fret about falling demand in the face of a world supply glut.
“US crude inventories continue to be the weekly constant mover for oil prices in this period of stagnant fundamentals,” said Daniel Ang, investment analyst at Phillip Futures in Singapore.
“If inventories turn out lower than estimates, we may see prices get more support and vice versa,” he added.
Industry group American Petroleum Institute reportedly said Tuesday that US crude reserves shrank by 7.3 million barrels in the week to August 21.
The numbers signaled healthy demand in the world’s top crude consumer ahead of the more closely watched official stockpiles report from the US Energy Information Administration later Wednesday.
Oil prices have come under pressure from concerns that China’s slowing economy will curb demand for the commodities that have helped feed its astonishing growth over the past three decades.
The devaluation of the yuan two weeks ago fuelled economic fears, sparking a slump in world equities sending commodities, as measured by the Bloomberg Commodity Index of 22 raw materials, to a 16-year-low on Monday.
Asian shares pushed higher in choppy trade on Wednesday after China’s central bank cut its benchmark lending and deposit interest rates in a bid to boost confidence.