WTI futures bounce back following API data

Crude oil futures were bouncing back, reclaiming nearly half of the previous day's losses after closely-watched private sector data revealed an unexpected drop in US oil stockpiles over the last week.

According to reports, overnight the American Petroleum Institute said commercial US oil inventories fell by 5.8m barrels.

During the reference week, gasoline inventories fell by 5.7m barrels and those of distillates increased by 400,000, the API data showed.

The figures were released ahead of the US Department of Energy's own estimates which were set to be released at 1530 BST, with analysts calling for a 1.6m barrel drop in oil inventories.

Commenting on the market reaction to the API figures, Naeem Aslam, chief market analyst at Think Markets, said: "The API data released last night showed that investors are excessively anxious about the supply glut. We saw a major draw down and it was much larger than the forecast."

However, Aslam cautioned that the correlation between the API and DoE inventory figures was rather weak.

As of 1006 BST, front month West Texas Intermediate crude oil futures were advancing by 1.44% to $45.79 a barrel on NYMEX.