Oil prices stabilise after sliding on US stock build

[SINGAPORE] Oil prices were broadly unchanged from their previous close in early trading on Thursday after tumbling 4 per cent a day earlier as US stockpiles rose for the first time in months on the back of high production.

Following Wednesday's drop, front-month US crude futures were trading at US$56.95 per barrel at 0015 GMT, down 1 cent from their last settlement.

Heading into the second half of the year, US crude has been testing support on the lower range of a US$57-62 per barrel price channel where it has been trading since early May.

Brent crude futures were trading at US$62.15 per barrel, up 14 cents, but the contract remains within a downward trend that has been in place since early May and which has seen prices fall more than 8 per cent.

The tumble in US crude came after government data showed inventories rose by 2.4 million barrels last week, marking the first weekly build since April.

The stock build came on the back of strong US production. "Overall, production was supported by increased output from the Gulf of Mexico," Barclays bank said following the publication of the data.

The higher US output added to an ongoing glut in global production.

Outside the United States, supply from the Organization of Petroleum Exporting Countries (Opec) rose to a three-year high of 31.60 million barrels per day (bpd) in June, up from 31.30 million bpd in May.

REUTERS