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U.S.
West Texas Intermediate (WTI) crude futures <CLc1> fetched
$41.74 per barrel at 0930 GMT (0530 ET), down 19 cents from
their last close, after trading as low as $41.44 earlier in the
day. They were on track roughly to break even on the week.
International Brent crude futures <LCOc1> were trading at $44.07
per barrel, down 22 cents on the day but set for a weekly gain
of around 3.5 percent.
Downward pressure returned as overproduction in crude and
refined products has left onshore storage tanks brimming and
triggered the chartering of tankers to store unsold fuel.
There are also growing worries that China's imports are
weakening from records set in 2015 and this year.
"Signs of fatigue are already apparent and include a notable dip
in Chinese crude oil imports," PVM's Stephen Brennock wrote,
adding that spare capacity in the country's strategic storage
space is less than 100 million barrels.
"A major pillar of oil demand is therefore on course to ease
considerably over the coming months," Brennock said.
Still, China surpassed South Korea as the top Asian buyer of
North Sea Forties crude this year, while trading house Trafigura
was aggressively targeting China's newest buyers by extending
credit to two of the country's independent refiners.
Oil prices were still more than $2 per barrel above the week's
lows, which most analysts attributed to short-covering.
Investors added the equivalent of 56 million barrels of short
positions in the three main Brent and WTI futures and options
contracts in the week to July 26.
"Since there was no news yesterday that might have triggered the
price rise, this points to short-covering," Commerzbank analyst
Carsten Fritsch said.
"Clearly many market participants were caught on the hop by the
increase in prices following the publication of U.S. inventory
data on Wednesday."
In oil market news, Yahoo's standalone messenger software, the
main tool used by traders to communicate since the late 1990s,
is due to shut down on Friday, leaving market participants with
a fragmented choice of alternatives, including Eikon Messenger,
ICE Instant Messaging, Symphony, Bloomberg Messenger, Twitter
and WhatsApp.
In pricing and analytics, leading commodity price reporting
agency S&P Global Platts has agreed to acquire global energy
market analysis firm PIRA Energy Group.
(Additional reporting by Henning Gloystein in Singapore; Editing
by Dale Hudson)
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