Oil trades near $47 as US glut seen easing

London - Oil traded near $47 a barrel before data forecast to show that gasoline stockpiles declined while crude inventories increased in the US, the world’s largest oil consumer.

Futures increased 0.7% in New York after falling 1.4% on Monday. Inventories of gasoline probably slid by 1.25 million barrels last week, according to a Bloomberg survey before an Energy Information Administration report on Wednesday.

Market volatility will persist while demand and supply rebalance, according to executives gathering at an oil conference in Norway.

Oil entered a bull market August 18, less than three weeks after tumbling into a bear market, as prices surged partly on speculation that talks next month among members of the Organisation of Petroleum Exporting Countries may result in action to stabilize the market.

A deal to freeze output was proposed in February but a meeting in April ended with no final accord.

"The US commercial inventory surplus of key oil products is shrinking more steadily and faster than it would appear," said Jan Stuart, global energy economist at Credit Suisse Securities.

"While large US downstream inventory surpluses persist midway through the third quarter, these surpluses are at once less big than they seem and have been steadily declining.'

West Texas Intermediate for October delivery was at $47.29 a barrel on the New York Mercantile Exchange, up 31 cents, at 12:39 p.m. London time.

The contract dropped 66 cents to settle at $46.98 on Monday. Total volume traded Tuesday was about 27% below the 100-day average.

US stockpiles

Brent for October settlement, which expires on Wednesday, was up 24 cents at $49.50 a barrel on the London-based ICE Futures Europe exchange.

Prices fell 66 cents, to $49.26 on Monday. The global benchmark crude traded at a $2.21 premium to WTI. The more-active November contract rose 22 cents to $49.67 a barrel.

US crude inventories expanded by 2.5 million barrels to 523.6 million through August 19, according to EIA data. They probably increased by 1.5 million barrels last week, according to the median estimate in the survey. Both crude and gasoline stockpiles are at their highest seasonal level in more than two decades.

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