Oil rebounds from near 2017 lows on falling US crude stocks
LONDON (Reuters) -- Oil prices rebounded from near 2017 lows on Wednesday after preliminary data showed a much larger-than-expected fall in US crude stocks, reviving bullish sentiment about easing oversupply.
Benchmark Brent crude was up 21 cents at $50.67 a barrel at 1346 GMT. On Tuesday the futures had settled at their lowest since Nov. 30, when the Organization of the Petroleum Exporting Countries decided to cut oil supply.
US West Texas Intermediate (WTI) crude traded at $47.81 a barrel, up 15 cents. WTI had slid 2.4% on Tuesday on concerns about falling OPEC compliance with its production-curbing deal.
Data from the American Petroleum Institute (API) assessing closely watched US oil inventories showed late on Tuesday that crude stocks had fallen last week by 4.2 MMbbl, nearly double the drop expected by analysts polled by Reuters.
"The API statistics are helping the market recover, but the underlying sentiment is still bearish," said Tamas Varga, analyst at London brokerage PVM Oil Associates.
The US government releases official inventory data from the Energy Information Administration on Wednesday at 1430 GMT.
The data will also provide an update on growth in US oil production, a key factor that has kept a lid on price gains driven by output cuts elsewhere.
"(US) production growth has slowed during the past couple of weeks. If continued today it may also add some glimmer of hope for the bulls, who increasingly have been losing patience," said Ole Hansen, head of commodities strategy at Saxo Bank.
Oil investors continue to eye producing countries' compliance with their pledge made in late 2016 to cut production by around 1.8 MMbpd by the middle of the year.
Russia, contributing the largest production cut outside OPEC, said on Wednesday that as of May 1, it had curbed output by more than 300 Mbpd since hitting peak production in October.
Its largest oil producer, Rosneft, said it had contributed just over 70 Mbpd to Russia's cuts.
This means Russia has achieved its reduction target a month ahead of schedule, just as the latest Reuters survey of OPEC production showed the group's compliance had fallen slightly.
More oil from Angola and higher UAE output than originally thought meant OPEC compliance with its production-cutting deal slipped to 90% in April from a revised 92% in March, the Reuters survey showed.
Reporting by Karolin Schaps; Additional reporting by Naveen Thukral in Singapore; Editing by Dale Hudson
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