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Brent crude futures were up 21 cents at $49.05 a barrel by 1204
GMT, while U.S. West Texas Intermediate crude futures were up 14
cents at $46.50 a barrel.
While U.S. crude stocks rose by 1.6 million barrels to 497.2
million barrels in the week to July 14, gasoline stocks fell by
a whopping 5.4 million barrels, the American Petroleum Institute
said on Tuesday.
"The (gasoline) draws reported by the API are very large and
gasoline was already strong," Olivier Jakob of oil consultancy
Petromatrix said.
"As long as you have gasoline that strong, it's very difficult
to sell crude oil aggressively."
Refinery upsets on the U.S. East Coast pushed the U.S. gasoline
crack spread <RBc1-CLc1>, or the profit from refining crude into
the motor fuel, to a three-month high at over $20 a barrel.
But supplies from the Organization of the Petroleum Exporting
Countries remain high, largely due to rising output from member
states Nigeria and Libya, casting a shadow on efforts by the
group to rebalance the market.
"Production in Libya is currently reported at or above 1 million
barrels per day, while August loading schedules for Nigeria have
risen to just over 2 million barrels per day," BNP Paribas said.
A Saudi Arabian industry source said on Tuesday that the
kingdom, by far OPEC's biggest producer, was committed to
tightening the market.
"We hope to accommodate the rise in production from Libya and
Nigeria taking into consideration other supply adjustments as
well. But we emphasize that we have to work together with other
producers and with the two countries," the source said.
Nigeria and Libya are exempt from a deal between OPEC and other
producers, including Russia, to cut production by around 1.8
million barrels per day between January this year and March
2018.
"Talk of capping Nigerian and Libyan output has been growing
fast (within OPEC). But it is very unlikely that both countries
will acquiesce to a cap so soon after restoring production," BNP
said.
Crude prices are down around 15 percent this year, making oil
one of the worst-performing commodities in 2017.
(Additional reporting by Henning Gloystein in Singapore; Editing
by Dale Hudson and David Evans)
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