Oil prices rebound ahead of US inventory data

Oil prices rose in European trade on Wednesday for the first time in six sessions, moving away from four-month lows as risk appetite rebounded.

Prices shrugged initial US data that showed an unexpected buildup in crude stocks last week, with official data scheduled for release later today from the EIA.

Prices 

US crude rose 1.4% to $73.85 a barrel, with a session-low at $72.84. 

Brent rose 1% today to $78.09 a barrel, with a session-low at $77.20. 

US crude lost 1.6% on Tuesday, the fifth loss in a row, plumbing a four-month low at $72.43. 

Brent gave up 1.3% yesterday, marking February 5 lows at $76.79. 

Oil prices were engulfed by a wave of losses due to a market glut, especially as OPEC+ prepares to gradually decrease its production cuts starting next October. 

In a surprise move, eight producers led by Saudi Arabia and Russia put a detailed plan to gradually get rid of current production cuts estimated at 2.2 million bpd, starting October 2024. 

Positive Sentiment 

Markets are currently dominated by a wave of strong sentiment as US 10-year treasury yields rebound.

A recent string of weak US data boosted the odds of multiple Fed rate cuts this year.

US Crude Stocks 

Initial data from the American Petroleum Institute showed an inventory buildup of 4.05 million barrels last week, while analysts expected a drop of 1.9 million barrels.

Official data from the EIA will be released today, still expected to show a drop of 2.1 million barrels.