Oil prices rose modestly Tuesday, snapping a three-day skid as traders awaited key data on US petroleum supplies and employment levels.
US benchmark West Texas Intermediate for delivery in September rose 57 cents to $ 45.74 a barrel on the New York Mercantile Exchange.
European benchmark Brent oil for delivery in September added 47 cents at $ 49.99 a barrel in London.
Tim Evans, analyst at Citi Futures, attributed the rise to bargain hunting given the low price level, sparked in part by a rally in the Chinese stock market.
However, analysts continued to warn that oil prices remain vulnerable due to a supply glut and uncertain demand growth.
“All the bearish elements continue to be in place here,” said John Kilduff, founding partner at Again Capital.
Kilduff said Wednesday’s Department of Energy petroleum supply report could spur additional selling if the data show weak gasoline use in the US.
Traders are also looking ahead to Friday’s US jobs report for July, which could lift the dollar if traders conclude the Federal Reserve is likely to raise interest rates more quickly. A strong greenback discourages crude purchases outside the US because oil is priced in dollars.
“The market definitely has been very sensitive to the dollar,” Kilduff said. If the jobs report is strong, he said, “I would expect the dollar to rally, which would push commodities prices down.”
