Oil futures rose on Thursday after slumping to a three-week low in the previous session, buoyed by a report from an industry body that showed United States crude stockpiles had fallen more than expected.
West Texas Intermediate for July delivery lost as much as $1.62 to $46.74 a barrel on the New York Mercantile Exchange, and was at $47.47 at 1:08 p.m.in London.
Still, oil markets received some support from official US data that showed the country's crude inventories fell sharply last week as refining and exports surged to record highs.
Meanwhile, all eyes will be glued to Thursday's U.S. Energy Information Administration report on stockpile futures. According to Platts Oil Futures editor Geoffrey Craig, U.S. crude oil inventories have reduced the surplus to the five-year average by 17 million barrels since the beginning of the year.
Oil headed for its biggest weekly drop in four weeks as US supply data signaled that OPEC's efforts to re-balance oversupplied markets need more time.
Oil prices sank 3 percent to a three-week low on Wednesday as an increase in Libyan output helped boost monthly OPEC crude production for the first time this year.
Gasoline demand during the United States summer driving season may support crude prices, analysts said. However, that understanding got broken as the production in the United States recovered by nearly 0.9 million barrels per day even as the oil price continued to hover below $50 per barrel.
May fighting to hang on after gamble fails
Though the biggest single victor , they failed to reach the 326-mark they would need to command a parliamentary majority. Instead, they lost seats and the majority, and will be forced to form a coalition government with a smaller party.
OPEC and other oil producers, including Russian Federation agreed last week to extend supply cuts by nine months, until the end of the first quarter of 2018. "We want to institutionalise cooperation between Opec and non-Opec producers", Saudi Energy Minister Khalid Al Falih said.
The concerns come amid continued uncertainty over whether the recent OPEC agreement to extend production cuts will actually manage to reduce global output.
Oil fell amid doubts that prolonged cuts by Opec and its allies will succeed in clearing a surplus while U.S. output remains so resilient.
Russia's most powerful oil boss said the deal between OPEC and its partners to curb output won't stabilize the crude market over the long term as USA shale fills the supply shortfall.
"The start of the USA driving season. boosted confidence in the market that stockpiles would start to fall in coming weeks", ANZ bank said on Tuesday.
Russia's May oil output was 10.94 million bpd, in line with its commitments to cut production, according to sources on Wednesday. Mostly to USA refiners who were running at almost 93% of full capacity last week, about three percentage points higher than at the same time previous year.
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