Investing.com - West Texas Intermediate oil futures initially pared losses in North America trade on Wednesday, after data showed that oil supplies in the U.S. fell and gasoline inventories declined more than expected.
Crude oil for July delivery on the New York Mercantile Exchange lost 9 cents, or 0.14%, to trade at $48.40 a barrel by 15:05GMT, or 11:05AM ET compared to $47.88 ahead of the report.
The U.S. Energy Information Administration said in its weekly report that crude oil inventories fell by 0.933 million barrels in the week ended June 10. Market analysts expected a crude-stock decline of 2.26 million barrels, while the American Petroleum Institute late Tuesday reported a supply increase of 1.518 million barrels.
Supplies at Cushing, Oklahoma, the key delivery point for Nymex crude, rose by 0.904 million barrels last week, the EIA said. Total U.S. crude oil inventories stood at 531.5 million barrels as of last week, which the EIA considered to be “historically high levels for this time of year.”
The report also showed that gasoline inventories decreased by 2.625 million barrels, compared to expectations for a drop of 0.243 million barrels, while distillate stockpiles rose by 0.786 million barrels, compared to forecasts for a decline of 0.249 million.
A day earlier, New York-traded oil prices shed 39 cents, or 0.8%. U.S. crude futures are up nearly 85% since falling to 13-year lows at $26.05 on February 11 as a decline in U.S. shale production boosted sentiment.
However, with prices now at levels that make drilling economical for some firms, the rig count might start rising soon and the decline in U.S. production may slow.
According to oilfield services provider Baker Hughes, the number of rigs drilling for oil in the U.S. increased by three last week to 328, the second straight weekly rise.
The renewed gain in U.S. drilling activity fueled speculation that domestic production could be on the verge of rebounding in the weeks ahead, underlining worries over a supply glut.
Elsewhere, on the ICE Futures Exchange in London, Brent oil for August delivery declined 48 cents, or 0.96%, to trade at $49.35 a barrel after falling to an intraday low of $48.68.
On Tuesday, London-traded Brent slumped 52 cents, or 1.03%, as global concerns over a Brexit weighed on appetite for riskier assets.
Recent polls suggested support for the U.K. campaign to leave the European Union is picking up.
A vote by Britain to leave the European Union may tip Europe back into recession, putting more pressure on the global economy and undermining future oil demand prospects.
Brent futures prices are still up by roughly 90% since briefly dropping below $30 a barrel in mid-February as unplanned supply disruptions in Africa eased concerns over a global glut
Meanwhile, Brent’s premium to the WTI crude contract stood at $1.11 cents a barrel, compared to $1.34 at close of trade on Tuesday.