SINGAPORE (Reuters) – Oil prices were steady on Thursday after falling the previous two sessions on industry concerns about rising supplies and signs of slowing demand.
Brent crude LCOc1 futures were at $62.36 a barrel, down 3 cents, or 0.05%, from the previous close, by 0555 GMT.
U.S. West Texas Intermediate (WTI) crude futures CLc1 were 2 cents lower, or 0.04%, to $56.47 a barrel.
Brent prices have dropped 3.6% since the close on Monday, while WTI is down 3.7% over the same period, weighed down by a surprise 2.4 million-barrel build in U.S. crude inventories last week and a faster than expected recovery of Saudi production capacity after the Sept. 14 attacks on its production plants.
Prices found slight support on hopes that the U.S.-China trade dispute may ease, potentially boosting oil demand.
U.S. President Trump said on Wednesday – a day after a stinging rebuke to China for its trade practices – that Beijing wanted to make a deal “very badly” and that a deal “could happen sooner than you think”.
Trump and Japanese Prime Minister Shinzo Abe also signed a limited trade deal that would open up Japanese markets to some $7 billion worth of U.S. products annually.
Aside from that, analysts said there was little to help lift crude futures higher.
“There’s not too much to be cheery about on oil markets today,” said Jeffrey Halley, senior market analyst for Asia Pacific at OANDA.
“Saudi Arabia is restoring production much faster than expected (and) the EIA crude inventories came in higher,” said Halley.
Both Brent and WTI on Wednesday fell to their lowest since the attacks on Saudi Arabia.
Crude futures were also pressured by sluggish economic data in leading European economies and Japan, analysts said.
“Fundamentally, a much weaker than expected Germany manufacturer PMI data painted a tepid outlook for energy demand,” said Margaret Yang, market analyst at CMC Markets.
“This bearish outlook is further strengthened by a rise in U.S. crude oil stockpile in the past weeks,” said Yang.
A firmer dollar .DXY, which posted its sharpest daily gain in three months overnight and held steady in Asian trade, also weighed on oil prices as it makes dollar-traded fuel imports more costly for countries using other currencies.
“Baring new inputs to adjust price expectations, both contracts are in grave danger of fully unwinding their Saudi attack rallies and retesting their pre-attack lows, around $60.00 and $54.00 respectively,” said Halley.
Reporting by Roslan Khasawneh; Editing by Tom Hogue and Christian SchmollingerOur Standards:The Thomson Reuters Trust Principles.