Brent oil gains $1 to claw back some losses

TOKYO (Reuters) – Brent crude rose more than $1 on Thursday as focus turned to a big drawdown in U.S. stockpiles, recouping some of the market’s heavy losses from the previous session that had been sparked by news that Libya would resume oil exports.

Brent crude () was up 96 cents, or 1.31 percent, at$74.36 by 0102 GMT, after earlier rising to $74.46. On Wednesday, the contract slumped 6.9 percent in its largest one-day percentage decline since Feb. 9, 2016.

U.S. crude () rose 21 cents, or 0.3 percent, to $70.59, after falling 5 percent the previous session.

“Both oil contracts have recently stalled around key long-term and psychologically-important levels at $80 and $75 respectively, as market participants weigh the risks of a potential correction in prices,” Fawad Razaqzada, an analyst at FOREX.com, said in a note.

The announcement by Libya’s National Oil Corp that four export terminals were being reopened, ending a standoff that had shut down most of Libya’s oil output, was the catalyst for a correction, Razaqzada said.

The reopening allows the return of as much as 850,000 barrels per day of crude into international markets.

But in the U.S. stockpiles are falling as refiners suck crude out of inventories to produce more gasoline for drivers in the peak summer season.

U.S. crude oil stocks fell by nearly 13 million barrels last week, the most in nearly two years, dropping overall crude stocks to their lowest point since February 2015, the Energy Information Administration said on Wednesday.

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