SINGAPORE: Another surge in US stockpiles pushed oil prices lower again today, giving up some of the big gains in New York that came after the Federal Reserve cooled the chances of an early summer interest rate hike.
US benchmark West Texas Intermediate (WTI) for April delivery was down 62 cents to USD 44.04 while Brent crude for May tumbled 16 cents to USD 55.75 in late-morning trade.
WTI gained USD 1.20 in US trade and Brent jumped USD 2.40 after the US central bank signalled it was in no hurry raise rates, which sent the dollar tumbling.
A weaker US currency makes dollar-priced oil cheaper, fuelling demand and boosting prices.
But the rally was shortlived as the fundamentals of an oversupplied market and weaker demand took hold of sentiment following the US crude inventory report, analysts said.
The US Department of Energy on Wednesday said stocks jumped 9.6 million barrels for the week ending March 13.
"The report indicates a build up in the global supply glut that has been pushing prices down thus far," said Shailaja Nair, associate editorial director at energy information provider Platts.
Daniel Ang, an investment analyst with Phillip Futures in Singapore, said prices will remain under pressure for as long as supply is outpacing demand.
"Fundamentals have not changed and just a short-term jolt in prices from the weakening US dollar will not change that fact," he said in a market commentary.
"Prices are still going to stay low if demand and supply does not improve."
World oil prices have collapsed by about 60 percent since June, with the strong US production exacerbating elevated output by the OPEC cartel.