Oil prices rose slightly this morning, extending their recovery after heavy falls sparked by euro zone debt tensions, as the market awaited key US energy inventory data.
US crude gained 13 cents to $97.56 a barrel, while Brent North Sea crude nudged up four cents to $117.79.
Oil prices had rebounded on Tuesday, one day after sliding on growing market concerns about the euro zone debt crisis and a weak US jobs market.
Today, supply concerns helped lift prices, as the International Energy Agency warned that the oil market still needed more supplies for the third quarter of the year.
'Major producers have recognised that demand for their oil is rising... as economic growth and short-term fuel substitution keep global and emerging market demand growth robust,' the IEA said in a monthly report.
The IEA also welcomed rising OPEC production in June. Yesterday, OPEC held broadly steady its forecast for oil demand this year and forecast steady demand growth next year, saying that the strength of economic recovery was unclear.
The oil market is meanwhile awaiting a weekly snapshot of energy inventories in the United States, which is the world's biggest consumer of crude oil. Ahead of the data, the privately-run American Petroleum Institute last night said that crude inventories increased for the first time in six weeks, by 2.3 million barrels to 359.4 million. An increase in stockpiles is seen as a sign of weaker demand.
