Oil futures headed higher on Thursday as recent data revealed a weekly decline in U.S. crude supplies and global production continued to decline.
Prices gave up an earlier decline from reports that a trade meeting between President Donald Trump and China President Xi Jinping may be delayed, if it happens at all. That had fueled some fresh worries about disruptions to demand driven by the protracted tariff dispute.
April West Texas Intermediate crude CLJ9, +0.58% rose 29 cents, or 0.5%, to trade at $58.55 a barrel on the New York Mercantile Exchange. It looks to settle at its highest since mid-November, just as it did on Wednesday, according to FactSet data.
May Brent crude LCOK9, +0.09% meanwhile, edged up by 13 cents, or 0.2%, to $67.68 a barrel on ICE Futures Europe, also holding near the highest level for the international benchmark in about four months.
“Crude futures posted new highs for the year,” following a nearly 4 million-barrel decline in last week’s U.S. crude supplies and “signs that U.S. oil production may be faltering,” said Phil Flynn, senior market analyst at Price Futures Group.
On Wednesday, the Energy Information Administration reported that U.S. crude supplies unexpectedly fell by 3.9 million barrels for the week ended March 8. The EIA also reported that total domestic crude production inched down from record territory, down 100,000 barrels to 12 million barrels a day.
Meanwhile, the Organization of the Petroleum Exporting Countries, in a monthly report released Thursday, said output by its members fell in February, though at a significantly reduced rate than the month prior and well-below the group’s pledge to the market.
Read: OPEC monthly report shows cartel has slowed pace of oil output cuts
The report also left the global demand growth forecast for 2019 unchanged from the previous month, at 1.24 million barrels a day, for total demand expectations of 99.96 million barrels a day.
Oil prices had declined earlier in the session as Bloomberg News reported Thursday morning that a meeting between Trump and Chinese President Xi Jinping will be delayed until at least April. That along with weaker-than-expected economic data from China, has contributed to losses for benchmark U.S. stock indexes Thursday which, in turn, fed risk-off sentiment.
Robert Yawger, director of energy at Mizuho Securities U.S.A., said that the dynamic for oil remains supportive of higher prices. “There are a lot of strong bullish elements here,” he said.
So far this week, futures contracts for WTI crude have jumped 4.4%, while the international benchmark has gained 3.1%.
Back on Nymex, April gasoline RBJ9, +0.32% added 0.5% to $1.866 a gallon, extending gains after a settlement Wednesday at its highest since October. April heating oil HOJ9, -0.19% rose 0.2% to $1.997 a gallon. The EIA’s weekly report had shown a weekly drop of 4.6 million barrels in gasoline supplies, but distillates, which include heating oil, had unexpectedly edged higher.
Natural-gas futures on Thursday held on to earlier gains after the EIA reported Thursday that domestic supplies of natural gas fell by 204 billion cubic feet for the week ended March 8. That was within range of the 208 billion cubic foot decline expected by analysts polled by S&P Global Platts.
April natural gas NGJ19, +0.50% traded at $2.836 per million British thermal units, up 0.6%.