Crude oil futures
declined on Wednesday, heading back towards $30 a barrel as
profit-taking wiped out a chunk of the gains notched up in the previous
session on hopes for output cuts.
Prices
were also dampened by a bigger-than-expected build in U.S. crude
inventory and worries about the economy in China, the world's
second-largest oil consumer.
Brent crude LCOc1 had declined 60 cents to $31.20 a barrel by 0723 GMT, after hitting a session low of $31.05 a barrel. It settled up $1.30 at $31.80 on Tuesday.
U.S. crude CLc1 fell 75 cents to $30.70 a barrel, recovering slightly from a session low of $30.30 a barrel. It ended Tuesday $1.11 higher at $31.45 a barrel.
"The positive sentiment stemmed from strong U.S. corporate earnings and talk of OPEC and Russia considering production cuts. We consider the likelihood of any agreement between these parties as extremely low," ANZ stated in a note on Wednesday.
Daniel Ang at Phillip Futures said: "With the U.S. ability to produce oil in much higher quantities, it will be difficult to support prices with supply cuts.
Therefore, it is probably the case that even if major producers want higher prices, they may not be able to achieve this without everyone's blessing."
"Inventory figures, if continuing to grow, would remind the market of the current oversupply. This would possibly be a bad sign for oil prices."
Brent crude LCOc1 had declined 60 cents to $31.20 a barrel by 0723 GMT, after hitting a session low of $31.05 a barrel. It settled up $1.30 at $31.80 on Tuesday.
U.S. crude CLc1 fell 75 cents to $30.70 a barrel, recovering slightly from a session low of $30.30 a barrel. It ended Tuesday $1.11 higher at $31.45 a barrel.
"The positive sentiment stemmed from strong U.S. corporate earnings and talk of OPEC and Russia considering production cuts. We consider the likelihood of any agreement between these parties as extremely low," ANZ stated in a note on Wednesday.
Daniel Ang at Phillip Futures said: "With the U.S. ability to produce oil in much higher quantities, it will be difficult to support prices with supply cuts.
Therefore, it is probably the case that even if major producers want higher prices, they may not be able to achieve this without everyone's blessing."
"Inventory figures, if continuing to grow, would remind the market of the current oversupply. This would possibly be a bad sign for oil prices."
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