Investing.com - Oil prices extended strong gains from the prior session in Europe trade on Thursday, on hopes that big producers will cap output and following upbeat industry data on U.S. stockpiles.
Crude oil for delivery in March on the New York Mercantile Exchange tacked on 68 cents, or 2.2%, to trade at $31.34 a barrel by 08:00GMT, or 3:00AM ET. A day earlier, Nymex futures soared $1.62, or 5.58%.
After markets closed Tuesday, the American Petroleum Institute, an industry group, said that U.S. oil inventories fell by 3.3 million barrels in the week ended February 12, surprising market players who were expecting an increase of 3.0 million barrels.
Crude stocks at the Cushing, Oklahoma, delivery hub for WTI declined by 175,000 barrels, the API said.
The U.S. Energy Information Administration will release its weekly report on oil supplies at 16:00GMT, or 11:00AM ET, Thursday, amid expectations for a gain of 3.9 million barrels. The report comes out one day later than usual due to Monday’s public holiday in the U.S.
Despite recent gains, U.S. oil prices are down nearly 17% so far this year. The U.S. benchmark slumped to a 13-year low of $26.05 last week, as a domestic supply glut dragged down prices.
Elsewhere, on the ICE Futures Exchange in London, Brent oil for April delivery inched up 31 cents, or 0.9%, to trade at $34.81 a barrel. On Wednesday, London-traded Brent futures surged $2.32, or 7.21%, after Iran supported plans by Russia and Saudi Arabia to cap production.
Iranian Oil Minister Bijan Zanganeh met his counterparts from Venezuela, Iraq and Qatar in Tehran for nearly three hours on Wednesday in an attempt to reach a deal to restrain output and prop up sagging prices.
Speaking following the conclusion of the meeting, Zanganeh said that he supports efforts by OPEC members to keep prices stable, but did not say if Iran would cap its output at current levels.
Top oil producers Russia and Saudi Arabia on Tuesday agreed to freeze oil production at January levels, provided other oil exporters joined in, but stopped short of agreeing cuts in oil output.
Brent prices are down almost 7% in 2016 as investors worried that a huge oversupply in crude was coinciding with a global economic slowdown.
Oil futures are down nearly 70% since the summer of 2014. Global crude production is outpacing demand following a boom in U.S. shale oil and after a decision by OPEC last year not to cut production in order to defend market share.
Meanwhile, Brent's premium to the West Texas Intermediate crude contract stood at $3.47 a barrel, compared to a gap of $3.84 by close of trade on Wednesday.