Investing.com - Oil prices rebounded slightly Thursday morning in Asia, pulled up by a report from the Energy Information Administration (EIA) that gasoline inventories had dipped.
Crude Oil WTI Futures for April delivery were trading at $61.30 a barrel in Asia at 10:50pm ET, up 0.25%. Brent Oil Futures for May delivery, traded in London, were down 0.11% at $64.48 per barrel.
Oil prices had dropped following a decline of more than 1 percent in S&P 500 Futures, triggered by the resignation of key free-trade advocate Gary Cohn, economic adviser to U.S. President Donald Trump, on Tuesday.
The EIA report came out a day after the 1-percent drop in S&P futures. The authority reported that gasoline stockpiles had declined by 800,000 barrels in the reporting period, compared with a 2.5-million-barrel build in the previous week. Since the start of the year, there has been only one week featuring a drop in gasoline inventories, while the total build since then stood at 17.8 million barrels.
However, oil markets remain volatile due to excess supply. The American Petroleum Institute estimated inventories had risen by 5.66 million barrels last week, further weakening oil prices after the blow from Cohn’s resignation led to growing concerns that a trade war is on the horizon.
Major powers including the European Union and China have warned that the Trump administration’s new protectionist import tariffs could lead to retaliatory action, triggering a global trade war that could bring economic growth to a standstill. This would, by extension, drag down oil consumption.
Meanwhile, increasing U.S. crude oil production continues to be a drag on efforts from the Organization of the Petroleum Exporting Countries (OPEC) to prop up prices by cutting output.
OPEC has been reducing output by around 1.2 million barrels per day (bpd) since January 2017.
However, the U.S. has simply taken the market share from OPEC producers by ramping up its oil production to over 10 million bpd. Not only is the U.S. moving closer to self-sufficiency, it is also set to become the world’s largest oil producer by 2019, further challenging OPEC’s ability to keep oil prices at comfortable levels.