LONDON—Crude-oil futures rallied alongside European equities and the euro, as the market continued to shrug off record high U.S. oil stockpiles.
Oil prices had snapped a five-day losing streak Wednesday after U.S. crude futures tumbled below $71 a barrel following the release of a bearish Department of Energy weekly oil inventory report.
Thursday, the front-month October Brent contract on London's ICE futures exchange recently was $1.05 higher at $74.53 a barrel. The front-month October contract on the New York Mercantile Exchange, called West Texas Intermediate, was 88 cents higher at $73.40 a barrel.
Market attention will likely focus on the strength of the economic recovery after this week's poor U.S. housing sales figures, analysts said. Weekly U.S. initial jobless claims data are due at 8:30 a.m. EDT.
The rise in oil prices has coincided with signs of improving demand in Europe. North West European complex refining margins, based on using the physical benchmark crude Dated Brent, improved to $4.89 a barrel Wednesday compared with the four-week average of $1.76 a barrel, according to JBC Energy.
Dated Brent also strengthened and Urals, a Russian sour crude, traded at a very high differential.
The ICE's gasoil contract for September delivery recently was $14.25 higher at $634.75 a metric ton Thursday, a gain of 2.3%, outstripping gains in Brent futures.
Wednesday's Department of Energy oil inventory data wasn't as bearish as the figures first suggested, pointed out Ed Meir of MF Global. Crude stockpiles rose 4.1 million barrels for the week ended Aug. 20, but all the rise occurred in the U.S. Gulf Of Mexico.
"However, crude oil inventories at Cushing fell by 779,000 barrels, blunting the impact of the overall increase somewhat," he said. The Oklahoma city is the delivery point for West Texas Intermediate.
Overall though, commercial U.S. crude and oil product stockpiles rose to another record high. Gasoline stocks rose 2.27 million barrels, and distillate stocks rose 1.76 million barrels.
Hurricanes and storms disrupting the oil-producing Gulf of Mexico region this month could relieve the pressure of inventory builds although there are none threatening currently, according to the National Hurricane Center.
Nymex gasoline for September delivery was 2.87 cents higher at 189.27 cents a gallon.
