Investing.com – Crude futures settled higher on Thursday, as traders mulled over data showing U.S. crude supplies fell the most in eleven-months while U.S. production rose to a more than two-year high.
On the New York Mercantile Exchange crude futures for September delivery rose 31 cents to settle at $47.09 a barrel, while on London's Intercontinental Exchange, Brent gained 64 cents to trade at $50.91 a barrel.
Crude oil snapped a three-day losing streak, as traders appeared to take advantage of lower crude prices, following a slump on Wednesday, after a report from the Energy Information Administration showed U.S. production hit two-year highs.
Total crude-oil production rose to 9.502m barrels per day, an uptick of 79,000 barrels a day compared to last week, the EIA said. That was the highest weekly output figure since mid-July 2015, offsetting bullish crude inventories data, narrowing expectations of crude futures breaching $50 a barrel.
“Barring any geopolitical catalysts, $50 [for WTI] will likely remain a stubborn resistance level in the near term, and if production continues to grind higher in the U.S., expect prices to remain under pressure,” said Tyler Richey, co-editor of the Sevens Report.
Inventories of U.S. crude fell by roughly 8.9m barrels in the week ended Aug 11, confounding expectations of a draw of about only 3.6m barrels. It was biggest draw in crude inventories in eleven-months.
The uptick U.S. production, however, adds to concerns that the global glut in crude supplies will continue during the second half of the year, as Opec’s rate of compliance with the global deal to curb production fell in July.
Opec’s rate of compliance with output cuts slid to 75 percent in July, the lowest since the accord started in January, the IEA said.
In May, Opec and non-Opec members agreed to extend production cuts for a period of nine months until March, but stuck to production cuts of 1.8 million bpd agreed in November last year.