Oil prices slipped after gains made earlier on Thursday and the previous day as overproduction and large volumes of unsold crude and ample refined products around the world weighed on markets.
Brent crude futures were trading at $42.72 a barrel at 1203 GMT, down 38 cents from their last close and down from an intra-day high of $43.65 a barrel.
U.S. West Texas Intermediate (WTI) crude futures were trading at $40.62 per barrel, down 21 cents, and after hitting an intra-day high of $41.41 per barrel and rising 3.3 per cent in the previous session.
“Prices began to recover following the publication of the U.S. inventory data [on Wednesday], and continued to do so into the morning,” Commerzbank said in a note.
“Maybe the surprise drawdown in gasoline inventories helped future prices remain stable but that does not change the fact: the U.S. is flooded with oil,” said Tamas Varga, lead oil analyst at London brokerage PVM Oil Associates.
Elsewhere, Iraq’s crude oil production in July rose to the highest level since January, to 4.632 million barrels-per-day compared with 4.559 million bpd in June, state-run oil marketer SOMO said on Thursday.
U.S.-based Schork Report said that the earlier price gains were a result of profit-taking from previous short positions that benefited from falling prices along with a fall in the U.S.-dollar since July.Click here for reuse options!