Oil prices edge up in Asia after another sell-off
SINGAPORE : Oil prices rebounded in Asia on Thursday on bargain-hunting on the last trading day of 2015 following a sharp decline fuelled by an unexpected rise in US commercial stockpiles.
The commodity headed for another annual loss caused by a stubborn global supply glut and weak demand.
Data from the US Department of Energy showed inventories climbed 2.6 million barrels to 487.4 million in the week ending December 25, confounding forecasts for a drop.
The inventories, a gauge of demand in the world’s top oil consumer, are stuck near record levels and are up 26.5 percent from a year ago.
US benchmark West Texas Intermediate (WTI) for delivery in February edged up 15 cents to $36.75 and Brent added 22 cents to $36.68 by around 0230 GMT.
Both contracts slumped more than three percent on the US data on Wednesday.WTI has lost 31 percent and Brent 36 percent of its value this year.In 2014, WTI lost 46 percent and Brent 48 percent.
“Thursday’s price rise comes from short-covering and consolidation after the steep decline on Wednesday,” said analyst with Phillip Futures in Singapore Daniel Ang.
“I think the renewed decline in oil could affect sentiment over energy stocks in Asia today, although we are likely to see very low volumes on the last trading day of the year,” said market strategist at IG Markets in Singapore Bernard Aw.
“I feel we are going to see a very quiet Asia.”, He further said.
Oversupply remains a concern well into 2016 after Organization of the Petroleum Exporting Countries in early December effectively rejected calls to cut its high output levels to revive prices.
Analysts are expecting no let up in production by OPEC and other oil producers such as the United States as they battle for market share.