After its largest drop in nearly a month, Brent crude oil regained some ground on Thursday morning as it climbed toward $103. The commodity traded at $102.26 at 7:32 GMT on Thursday as a weakening dollar helped buoy prices.
Brent slid significantly after a report from the American Petroleum Institute shocked analysts on Wednesday with data that showed US crude inventories increased by 4.4 million barrels in the week ending on May 24. According to CNBC, Reuters had originally seen US crude inventories falling 400,000 barrels. Moving forward, investors will be waiting for data from the US Energy Information Administration which is set to release a report later on Thursday.
Losses from the increased stockpiles were partially recovered as fears that the US Federal Reserve would cut back on its quantitative easing program subsided. Following positive data, many worried that the central bank would start to cut back on its $85 billion bond buying program, but now most are expecting the Fed to continue for the time being.
The Organization of the Petroleum Exporting Countries will meet on Friday to discuss its output policy for the remainder of 2013. Most are expecting the organization to maintain its current output targets after Saudi Arabian Oil Minister Ali al-Naimi made comments on Tuesday indicating that his country, the largest OPEC producer, is happy with the current market conditions.
Investors will also be keeping an eye on Chinese PMI data for clues about the nation's economy. A recent string of poor data has many worried that the number two oil consuming nation's oil demand will not pick up any time soon, and analysts are forecasting a drop in the country's May PMI.
