Oil rallied after the biggest two-day slump in a month as U.S. industry data showed the pace of crude stockpile growth slowed amid a glut.
Futures advanced as much as 2 percent in New York after falling 5.6 percent the previous two sessions, the biggest two-day slide since Feb. 11. Inventories expanded by 1.5 million barrels last week, the American Petroleum Institute was said to report Tuesday. That’s the smallest increase since supplies fell through the week ended Feb. 12. Output from the Kirkuk fields in Iraq was halted for a third day, said a person at North Oil Co. familiar with the matter.
Oil has rebounded after slumping to a 12-year low this year on speculation a global surplus will ease amid stronger demand and falling U.S. output. American crude stockpiles probably rose by 3.2 million barrels last week, according to a Bloomberg survey before government data Wednesday. That would keep supplies at the highest level in more than eight decades.
“Incremental supply is coming out of the market,” Michael McCarthy, a chief strategist at CMC Markets in Sydney, said by phone. “There’s evidence of a decline in U.S. output and the drill rig count continues to edge lower. A combination of those factors and the wildly oversold nature of the market mean that we’re seeing more stability.”
West Texas Intermediate for April delivery advanced as much as 72 cents to $37.06 a barrel on the New York Mercantile Exchange and was at $36.86 at 9:27 a.m. Hong Kong time. The contract fell 84 cents to $36.34 on Tuesday. Total volume traded was about 14 percent below the 100-day average.
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Brent for May settlement climbed as much as 51 cents, or 1.3 percent, to $39.25 a barrel on the London-based ICE Futures Europe exchange. The contract dropped 79 cents to $38.74 on Tuesday. The global benchmark crude was at a premium of 49 cents to WTI for May.
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