SINGAPORE: Oil prices enjoyed rare gains in Asian trade today, with Brent crude bouncing from an 11-year low as investors await a closely watched US crude inventory report.
At 0330 GMT, US benchmark West Texas Intermediate (WTI) for delivery in February, a new contract, was 29 cents higher at USD 36.10 a barrel.
The European standard, Brent crude, for February was at USD 36.56, up 21 cents from its closing level of USD 36.35 in London yesterday, which was the lowest since July 2004.
"This could be positioning ahead of the weekly American reports, which should show rising crude inventories," said Bernard Aw, market strategist at IG in Singapore.
Oil is heading for a second annual loss on signs a global glut will be prolonged after the Organization of the Petroleum Exporting Countries effectively abandoned output limits at a meeting on December 4.Brent slumped yesterday on speculation suppliers from the Middle East to the United States will continue pumping, exacerbating the surplus as they fight for market share.
"It's all about market share and bravado at the moment," Jonathan Barratt, the chief investment officer at Ayers Alliance Securities in Sydney, told Bloomberg News.
Crude prices have sunk more than 60 per cent from above USD 100 in summer 2014 owing to the oversupply as well as weak demand, a global economic slowdown and a strong dollar.