SEOUL: Crude oil futures traded largely unchanged on Wednesday after falling by just over one percent in the previous session on an International Energy Agency report that said the market would remain oversupplied for at least another year.
Front-month Brent for November delivery rose 10 cents or 0.2 percent to $49.34 a barrel as of 0254 GMT after it ended at $49.24 per barrel, down 1.24 percent, or 62 cents on Tuesday.
U.S. crude edged up 19 cents, or 0.41 percent, to $46.85 a barrel after settling 0.93 percent, or 44 cents, lower at $46.66 a barrel.
Crude futures rose 15 percent in early October but have since fallen back by almost 10 percent as global production continues to outpace demand and concerns over China’s slowing economy prevail despite strong import figures released this week.
On Wednesday, data from China which showed consumer inflation had eased more than expected in September while producer prices fell for the 43rd straight month, adding to concerns over growing deflationary pressures in the world’s second-largest economy.
“Prices should remain low…the main reason for that is because global supply and demand for crude did not change much over the past few weeks or even months. We are still in oversupply,” Daniel Ang, an investment analyst at Phillip Futures Pte Ltd.
“Considering that you know we are looking for possible worsening oversupply coming from Iran..this puts the whole situation a lot more bearish.”
ANZ also said in a morning note: “Commodity prices were weaker overnight. Base metals, iron ore and crude oil all fell as the impact of the relief rally starts to wane.”
A global oil supply glut will persist through 2016 as demand growth slows from a five-year high and key OPEC members maintain near-record output, said the International Energy Agency, even as low prices curb supply outside the producer group.
U.S. shale production is expected to fall the most on record in November, extending a nationwide output decline into its seventh consecutive month, according to a forecast on Tuesday from the U.S. Energy Information Administration.
The number of North Dakota oil wells that have been drilled but not fracked rose to an all-time high in August of almost 1,000, as producers delayed bringing them online as long as possible in hopes that crude would rebound.
Global offshore oil production in ageing fields will fall by 10 percent next year as producers abandon field upgrades at the fastest rate in 30 years, in the first clear sign of output cuts outside the U.S. shale industry, exclusive data shows.
As the oil market remains over supplied, Saudi Arabia failed to attract offers for additional oil cargoes for loading in October, industry sources said.
Venezuelan Oil Minister Eulogio del Pino said on Tuesday that eight non-OPEC countries have been invited to an Oct. 21 technical meeting of oil experts from the Organization of Petroleum Exporting Countries and non-OPEC countries in Vienna.