Oil futures ended on a higher note Thursday after OPEC members failed to reach an agreement limiting oil production and weekly government reports confirmed a reduction in U.S. crude inventories, according to Bloomberg MarketWatch.
July West Texas Intermediate crude tacked on 16 cents, or 0.3%, to end trading on the New York Mercantile Exchange at $49.17 a barrel, reflecting their first increase in the past five days of trading. Earlier in the day, oil futures fell under $48 a barrel after the OPEC meeting in Vienna failed to set crude oil productions caps that were sought by the Saudis. Prices rebounded on the news that the U.S. Energy Information Administration’s weekly report indicated a decrease of 1.4 billion barrels for the week ending May 27.
Reaching its highest result since November, Brent crude rose 32 cents, or 0.6%, ending trade on London’s ICE Futures Exchange at $50.04 a barrel for the August contract.
“There was never a chance that OPEC would cut production today, meaning there are no real surprises from the outcome of this meeting resulting in OPEC failing to reach an output deal,” said Jameel Ahmad, chief market analyst at FXTM.
But “to put it quite simply, there was very little need for OPEC to change their strategy,” he continued. “It is important to point out that the price of oil has rebounded substantially since the milestone lows below $30 at the beginning of 2016.”
The EIA report also reflected that gasoline supplies fell by 1.5 million barrels.
July natural gas added 2.4 cents, or 1%, to reach $2.405 per million British thermal units on the New York Mercantile Exchange. Earlier in the day, natural gas traded at $2.38 per million British thermal units before the release of the EIA’s weekly report indicating gas supplies increased by 82 billion cubic feet for the week ending May 27.