Oil traded near $57 a barrel after swinging wildly in the previous session as investors focused on U.S. crude production that climbed to the highest in more than three decades. Futures were little changed in New York. Prices on Wednesday closed 0.7 percent lower after soaring 1.3 percent as multiple platforms suspended operations in the Gulf of Mexico. U.S. output expanded for a third week to 9.62 million barrels a day, the highest in weekly Energy Information Administration data going back to 1983. Crude inventories rose 2.24 million barrels last week, compared with a 2.45-million drop forecast in a Bloomberg survey.
Oil has advanced about 20 percent since the start of September on signs the Organization of Petroleum Exporting Countries and its allies will extend output cuts past March. An anti-corruption probe in Saudi Arabia, the world’s top exporter, has added to price gains as arrests were seen as consolidating power for the crown prince who has supported prolonging the production reductions.
“Higher prices are a definite factor in bringing production back on — this is a problem for OPEC,” said Michael McCarthy, a chief strategist at CMC Markets in Sydney. “The first response comes from the most agile producers, but once it looks like oil prices could be sustained at higher levels, then even less agile producers can come back online.”
West Texas Intermediate for December delivery was at $56.84 a barrel on the New York Mercantile Exchange, up 3 cents, at 2:27 p.m. in Hong Kong. Total volume traded was about 32 percent below the 100-day average. Prices lost 39 cents to $56.81 on Wednesday, falling for a second session.
Brent for January settlement gained 6 cents to $63.55 a barrel on the London-based ICE Futures Europe exchange, after falling in the past two sessions. The global benchmark crude was at a premium of $6.48 to January WTI.
Crude stockpiles at Cushing, Oklahoma, the delivery point for WTI and the biggest U.S. oil-storage hub, rose by 720,000 barrels to 64.6 million, the EIA said Wednesday. Gasoline supplies fell a third week to 209.5 million barrels.
- ConocoPhillips expects its capital spending to average about $5.5 billion a year in the next three years, it said Wednesday. That would be $1 billion more than what the company has forecast for its budget this year.