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Oil takes a breather after rallying to 8-week highs

Published 2017-07-27, 08:13 a/m
© Reuters.  Oil retreats after rallying to 8-week highs
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Investing.com - Oil prices were a bit lower in North American trade on Thursday, pausing for breath after rallying to the highest level in around eight weeks earlier in the session.

The U.S. West Texas Intermediate crude September contract was at $48.38 a barrel by 8:10AM ET (1210GMT), down 37 cents, or around 0.8%. It touched its highest since June 1 at $48.94 in overnight trade.

Elsewhere, Brent oil for September delivery on the ICE Futures Exchange in London slipped 37 cents to $50.60 a barrel, after touching an eight-week peak of $51.23 earlier.

Oil prices finished higher for the third-session in a row on Wednesday, as data showing a fourth consecutive week of declines in U.S. crude inventories added to optimism that the market was rebalancing.

U.S. oil inventories fell by 7.2 million barrels at the end of last week to 483.4 million barrels, much more than the expected drop of around 2.6 million barrels.

The report also showed that gasoline inventories decreased by 1.0 million barrels, compared to expectations for a much more modest decline of 0.6 million barrels.

Oil is on track to score a weekly gain of more than 6% as fresh pledges from Saudi Arabia and Nigeria to respectively pull back on exports and output boosted sentiment.

Signs of a possible slowdown in U.S. shale production in the wake of reduced spending plans for some oilfield services companies further added to the bullish momentum.

Elsewhere on Nymex, gasoline futures for August was up less than half a cent to $1.615 a gallon, while August heating oil shed 0.5 cents to $1.589 a gallon.

Natural gas futures for September delivery was little changed at $2.915 per million British thermal units, as traders looked ahead to weekly storage data due later in the global day.

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