Oil prices eased on Wednesday after figures from an industry group showed U.S. crude stockpiles rose last week by more than expected, reinforcing concerns that a global glut continues unabated.
U.S. crude futures fell 52 cents to $40.93 a barrel by 1239 GMT. Prices struck a 2016 high of $41.90 in the previous session. The contract has rebounded more than 50 percent after hitting its lowest since 2003 in February.
Brent crude was down 39 cents a barrel at $41.40, still up more than 50 percent from a multi-year low of $27.10 hit in January.
“Net supply in the short term should still be in excess and thus brings us to believe that the current uptrend is unsustainable,” Phillip Futures analyst Daniel Ang said in a note.
Traders such as Vitol, Gunvor and Glencore are betting on oil markets remaining oversupplied for at least two more years.
Traders are looking to extend or lock in new leases on storage tanks for crude and refined products in key hubs as far out as the end of 2018, sources at storage firms and trading houses say.
The American Petroleum Institute (API) said on Tuesday that U.S. crude inventories rose by 8.8 million barrels last week, a gain almost three times higher than that predicted in a Reuters poll.
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