Oil prices rose about $ 1 a barrel on Wednesday, bouncing from the lowest levels in months, after US government data showed strong demand for refined fuel, but concerns remained over rising global crude supply.
Brent crude futures gained 95 cents to settle at $ 63.48 and barrel, up 1.52 per cent. U.S. Pat. West Texas Intermediate (WTI) crude futures rose $ 1.20 to settle at $ 54.63 and a barrel, and a 2.25 percent gain.
U.S. Pat. crude stocks rose 4.9 million barrels last week, the Energy Information Administration said, a larger-than-expected increase. Crude inventories have risen for nine straight weeks, the longest streak since March 2017.
Crude stocks at Cushing, Oklahoma, the delivery hub for WTI fell 116,000 barrels, the first drop in nine weeks, EIA said.
Gasoline stocks fell 1.3 million barrels to the lowest level since December 2017, while the distillate stockpiles dropped by 77,000 barrels, the EIA data showed.
"Cushing posted the first decline in a couple of months, and a possible level of some leveling that could drive some support into the WTI curve," said Jim Ritterbusch, president of Ritterbusch and Associates, in a note.
The global market remained weak after crude fell more than 6 per cent in the previous session, while global equities tumbled on worries about economic prospects.
Brent has fallen by more than 25 percent since reaching a four-year high of $ 86.74 on Oct. 3, reflecting forecasts of slowing demand and ample supply from Saudi Arabia, Russia and the United States.
Worried by the prospect of a new supply of glut, the Organization of Petroleum Exporting Countries is talking about reducing output just months after increasing production.
OPEC, Russia and other producers are considering a supply cut of between 1 million barrels per day (bpd.) And 1.4 million bpd. at a Dec. 6 meeting, sources familiar with the issue have said.
However, Saudi Arabia may find it harder to act on support prices, analysts say, after US President Donald Trump on Wednesday praised Saudi Arabia for helping lower oil prices.
Riyadh could feel more inclined to heed US demands after Trump promised on Tuesday to be a "steady partner" of Saudi Arabia despite saying Crown Prince Mohammed bin Salman may have known about a plan to kill journalist Jamal Khashoggi.
U.S. Pat. energy firms cut three oil rigs in the week to Nov. 21, bringing the total down to 885, General Electric Co.'s Baker Hughes Energy Services firm said on Friday.
"It's fair to say that the price of oil will continue to be pretty volatile between now and Dec. 6 when OPEC meets, "said Brian Kessens, managing director at Tortoise. "There's going to be a lot of different rhetoric and anticipation of what will actually happen."