Oil prices rose on Wednesday, following news of Saudi supply cuts to Asia, but persistent doubt over output reductions and signs of rising shipments from other producers kept gains in check.
Brent crude futures were up 31 cents, or 0.58 percent, at $53.95 a barrel by 10:35 a.m. ET (1535 GMT), while U.S. West Texas Intermediate (WTI) crude oil futures were up 26 cents, or 0.51 percent, at $51.08 a barrel.
U.S. gasoline prices were also up 1.7 percent at $1.573, on pace for only their second positive day this year.
On Wednesday, the U.S. Energy Information Administration said U.S. crude inventories increased by 4.1 million barrels from the previous week. Total motor gasoline inventories increased by 5 million barrels last week, distillate fuel inventories increased by 8.4 million barrels last week, EIA said.
Brent has surrendered nearly 40 percent of the gains made between late November and early January. Analysts, however, said the slide was unlikely to become more aggressive, given the likelihood of Saudi Arabia and its Gulf neighbors at least sticking to their pledge to cut output.
“Few envision that Brent crude at sub-$50 a barrel is a viable price (in H1, or the first half of 2017) amid OPEC production cuts tightening up the market,” SEB commodities strategist Bjarne Schieldrop said.
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