SINGAPORE (Reuters) – Oil prices edged up on Thursday, after falling the previous day on an unexpectedly high build in U.S. crude inventories.
Prices were supported by supply disruptions in Nigeria and the likelihood that OPEC will maintain its production cuts at its next meeting.
London Brent crude, currently more representative of the global market than U.S. prices, was up 37 cents at $65.57 a barrel by 0748 GMT, after a loss of 34 cents on Wednesday. U.S. crude for June delivery was 22 cents higher at $61.77 a barrel.
“The short-term focus is on the Nigeria situation and crude inventories in the U.S. and the market is quite range-bound,” said Tetsu Emori, analyst at Mitsui Bussan Futures.
Weekly government data showed U.S. crude oil stocks increased by 5.6 million barrels last week, far exceeding analyst expectations for a rise of 400,000 barrels, due to high imports and muted demand from U.S. refiners.
Gasoline inventories also rose for the first time in 13 weeks ahead of peak summer demand, though the slight 400,000-barrel build was within market expectations.
The bearish inventory data overshadowed worries over supplies from Nigeria, where rebels took four American oil workers hostage on Wednesday, just a day after blowing up three oil pipelines belonging to Italy’s Eni and halting daily output of 150,000 barrels.
The world’s eighth-largest oil exporter has seen about 28 percent of its supply disrupted, though the country’s oil minister Edmund Daukoru said he expected the violence to subside by next month when a new president takes office.
Supplies from OPEC producers have been cut by agreed output curbs totaling 1.7 million barrels per day (bpd), though two OPEC ministers told Reuters they would not want to raise the group’s production levels at its next meeting in September.
“I can say the market is saturated with oil,” said Qatar’s Abdullah bin Hamad al-Attiyah.
Algerian Oil Minister Chakib Khelil said the global oil market is currently oversupplied by about 200,000 bpd and that he would oppose any move to raise production.