Oil rises for second day, but oversupply concerns cap gains

Oil prices charged higher on Thursday, to continue its gains for the second straight day, buyod by hopes about the US and China trade deal, while these gains were capped by a sharp surge in the US crude inventories, which stoked market concerns over a US supply glut.

WTI rose to $53.30, from the opening of $52.93, with an intraday nadir of $52.80.

Brent rose to $59.48 a barrel, from the opening of $58.96, with a low of $58.85.

WTI closed higher by 0.25% yesterday, and Brent futures gained 0.3%, in their first straight daily gain in 3 days, after OPEC chief executive Mohammed Barkindo's remarks regarding deeper output cuts

Chief executive Mohammed Barkindo stated on Wednesday that "OPEC Plus" will ensure the oil market balance in 2020.

The Chinese commerce ministry said today that China hopes to reach a phased trade agreement with the US as soon as possible to make progress on removing tariffs on their imports.

The remarks increased the market hopes for a final reach of a trade deal, as it will improve the global economy and fuel demand outlooks.

Otherwise, the American Petroleum Institute (API) announced yesterday in preliminary data that the US commercial crude inventories surged by 10.5 million barrels during the week that ended in October 11, in the second straight increase, higher than forecasts of 2.9 million barrels.

While the total inventories rose to 426 million barrels, the highest level since August 16, to raise concerns about domestic demand in the US.

The official data on inventories and production levels will be released later today, by the US Energy Information Administration (EIA) in its weekly report, with forecasts for a rise by 2.5 million barrels for the fifth week.