Oil rose more than 2 percent on Tuesday after falling by around $4 a barrel in one week, but investors remained concerned about oversupply weighing on prices.
Global fuel inventories are brimming as refineries have churned out huge volumes of diesel, gasoline and jet fuel but the supply glut has diminished refining margins and demand failed to keep up with supply.
Global benchmark Brent crude was trading up 87 cents at $43.01 a barrel at 1354 GMT (0954 ET), after touching a session high of $43.18.
U.S. West Texas Intermediate (WTI) crude was up 67 cents at $40.73 a barrel, having reached a session high of $40.91.
“There is much talk about the product glut replacing the oil glut, and this is a worrisome indicator for crude demand,” said Frank Klumpp, oil analyst at Stuttgart-based Landesbank Baden-Wuerttemberg.
Record inventory levels, additional supply capacity and weaker demand expectations led Natixis analysts to reduce their 2016 oil price estimates on Tuesday.
via Reuters