The price of crude oil rose for the first time in eight days, a positive turn as Chinese data showed record imports in December and US oil pulling further away from $30-per-barrel level.
Brent crude, the global benchmark, was up 87 cents at $31.73 a barrel, but hovered around low levels not seen for 12 years.
US West Texas Intermediate crude (WTI) was up 26 cents at $30.70 a barrel. On Tuesday, it fell 97 cents to close at $30.44 a barrel, after touching a low of $29.93, not seen since December 2003.
“The API inventory data triggered a profit-taking wave, that’s the main reason for this uptick,” said Hans Van Cleef, Senior Energy Economist at ABN Amro in Amsterdam. “But the overall sentiment is still negative, meaning downside risk is still greater than upside potential,” he added.
U.S. crude stocks fell unexpectedly last week, data from industry group the American Petroleum Institute showed on Tuesday.
Crude inventories fell by 3.9 million barrels in the week to 480.071 million, compared with analysts’ expectations for an increase of 2.5 million barrels. Crude stocks at the Cushing, Oklahoma delivery hub fell by 302,000 barrels, the API said.
China reported exports dipped just 1.4 percent in U.S. dollar terms in December, compared to forecasts of an 8 percent drop, positively surprising world markets.
However, Chinese crude imports rose to a record 7.82 million barrels in December, up more than 21 per cent from November, official data showed.
Analysts at Morgan Stanley said in a research note: “Any slowing in the rate of demand growth could delay the timing of rebalancing and ultimately a price recovery”.