SEOUL (Reuters) – Oil prices were mixed on Wednesday in thin trading as the US benchmark rebounded from the sharp losses of the previous session, although concerns over global health continued to overshadow the market in the longer term.
FILE PHOTO: Oil spills out of a spout from Edwin Drake's original 1859 fountain from which the modern oil industry started at the Drake Well Museum and Park in Titusville, Pennsylvania, USA on October 5, 2017. REUTERS / Brendan McDermid
USA. West Texas Intermediate (WTI) CLc1 commodity futures rose 29 cents, or 0.68 percent, to $ 42.82 a barrel at 0355 GMT, up 2 percent from the last close. They had fallen 6.7 percent to $ 42.53 a barrel in the previous session, the lowest since June 2017.
Meanwhile, Brent crude oil futures LCOc1 declined 11 cents or 0.22 percent to 50 percent , $ 36 per barrel, after falling 6.2 percent in the previous session, was $ 50.47 a barrel, the weakest since August 2017.
"$ 50 is a psychological support level (for Brent)," said Margaret Yang, market analyst for CMC Markets in Singapore.
"But market confidence needs to be restored to the oil price … This includes a stock market recovery and / or a larger production cut by major oil exporters," Yang said, referring to an OPEC-led agreement to increase production lower next month.
Broader financial markets were under pressure from concerns over a global slowdown in the face of higher US interest rates and the trade dispute between the US and China.
"US. Stock futures are trading a bit firmer this morning, triggering some buying interest in the oil markets, "said Stephen Innes, Asia-Pacific Trade Director for Futures Brokerage Oanda in Singapore.
Innes added that macroeconomic fears would continue unless the Organization of Petroleum Exporting Countries (OPEC) "gives markets the profitability of their supply cuts and makes them even lower than some members have suggested". OPEC and its Russia-led allies agreed this month to cut oil production by 1.2 million barrels a day from January.
Russia's Energy Minister Alexander Novak said on Tuesday that oil prices would stabilize in the first half of 2019, supported by the combined efforts of OPEC and non-OPEC countries to curb production.
In other areas, too, the political turmoil in the United States, triggered by the partial closure of the federal government, heightens concerns about the market. President Donald Trump said Tuesday that the shutdown could continue until his demand for US-Mexican boundary wall money is met.
Reporting by Jane Chung; Additional reporting by Naveen Thukral in SINGAPORE; Cut by Kenneth Maxwell