Investing.com - West Texas Intermediate oil prices extended gains from the prior session in European trade on Wednesday, amid speculation weekly supply data due later in the session will show U.S. crude inventories rose at a slower pace than expected last week.
The U.S. Energy Information Administration will release its weekly report on oil supplies at 14:30GMT, or 10:30AM ET, amid expectations for a gain of 3.2 million barrels.
After markets closed Tuesday, the American Petroleum Institute, an industry group, said that U.S. oil inventories fell by 4.3 million barrels in the week ended April 1, surprising traders who were expecting an increase of 2.9 million barrels.
Crude stocks at the Cushing, Oklahoma, delivery hub for WTI rose by 62,000 barrels, the API said, while distillate inventories added 2.7 million barrels. Gasoline inventories fell by 116,000 barrels.
Crude oil for May delivery on the New York Mercantile Exchange jumped 89 cents, or 2.48%, to trade at $36.78 a barrel by 06:57GMT, or 2:57AM ET.
A day earlier, Nymex oil prices closed up 19 cents, or 0.53%, at $35.89, after slumping to a daily low of $35.24, the weakest level since March 4.
U.S. crude futures are down almost 15% since hitting a recent high of $41.90 on March 22. Despite recent losses, prices are still up nearly 35% since falling to 13-year lows at $26.05 on February 11.
Elsewhere, on the ICE Futures Exchange in London, Brent oil for June delivery rose 61 cents, or 1.61%, to trade at $38.48 a barrel.
On Tuesday, London-traded Brent futures slumped to an intraday low of $37.27, a level not seen since March 4, before recovering to settle at $37.87, up 18 cents, or 0.48%.
Traders reacted to comments from Kuwait's OPEC governor Nawal Al-Fuzaia, who said that all signs suggest that a meeting of OPEC and non-OPEC oil producing countries in Doha on April 17 will result in an initial agreement to freeze output at February levels, or at an average of January and February levels.
The original proposal by Saudi Arabia, Qatar, Russia and Venezuela was for a freeze at January levels.
Doubts that oil producing countries would freeze output to address a global glut mounted last week after Saudi Deputy Crown Prince Mohammed bin Salman said that the kingdom will not cap output unless Iran and other major producers do so as well.
Iran has maintained that it will not contribute to any output freeze until its crude exports return to pre-sanction levels of around 4 million barrels a day.
Brent futures are down almost 12% from their March highs of $42.50 a barrel. Despite recent losses, prices are still up by roughly 35% since briefly dropping below $30 a barrel on February 11.
Short-covering began in mid-February after Saudi Arabia and fellow OPEC members Qatar and Venezuela agreed with non-OPEC member Russia to freeze output at January levels, provided other oil exporters joined in.
Meanwhile, Brent's premium to the WTI crude contract stood at $1.70 a barrel, compared to a gap of $1.98 by close of trade on Tuesday.