SINGAPORE: Oil prices rallied for a sixth day in Asia on Thursday as markets were boosted by figures showing a decreasing US stockpile.
The weekly US inventories report released Wednesday showed significant declines in commercial crude stockpiles, pointing to a modest strengthening of demand in the world’s top oil consumer.
US crude stockpiles fell by 2.5 million barrels in the week to August 12, and gasoline stocks declined 2.7 million barrels.
The dollar-priced commodity was also propped up by a weaker dollar, which makes crude cheaper for those holding other currencies.
Prices had dipped slightly during early Asian trade but rebounded by midday, with Brent crude briefly pushing past the psychological $50 mark.
At about 0800 GMT, US benchmark West Texas Intermediate for September delivery was up 26 cents to $47.05 while North Sea Brent was up four cents to $49.89.
Prices hit five-week highs this week, supported by hopes that a Russian-Saudi cooperation may reach a pact to freeze output, easing the stubborn supply glut dogging the market since late last year.
OPEC members and their non-OPEC rivals are to meet informally in Algeria next month, and both Saudi and Russia have indicated they could discuss measures to stabilize prices.
Analysts however, have said gains are being eroded by media reports that Saudi Arabia, OPEC’s top producer, is ramping up production to fresh record levels in August.
Saudi output was at a record 10.67 million barrels per day in July.
“The upside is capped by Saudi’s signals of pumping more oil in August, which could give the Kingdom more leverage during talks in Algeria next month,” said EY Services oil and gas head Sanjeev Gupta.
“The oil market will continue to seesaw amid skepticism over the coordinated efforts to stabilize output,” he told Agence France-Pressse by email.