Oil rebounds on fresh hopes for US-China trade deal

United States Oil lower after U.S. government data revealed that domestic crude supplies rose for a second week in a row

Fall comes after oil market posted gains for three consecutive sessions.

Benchmark Brent crude rallied 1.2 percent to $62.49 a barrel, after having fallen nearly 2 percent on Wednesday. West Texas Intermediate crude CLc1 lost 74 cents, or 1.3%, to trade at $56.49 per barrel.

The American Petroleum Institute (API) reported crude stockpiles increased by 4.26 million barrels last week, according to people familiar with the data.

Gasoline and distillate inventories dropped 2.8 million barrels and by 622,000 barrels respectively.

Total products supplied over the last four-week period averaged 21.2 million b/d, up by 2.4 percent from the same period a year ago.

Earlier, prices dropped after data from the Energy Information Administration (EIA) showed US crude inventories rose by 7.9 million barrels in the week to November 1, compared with analysts' expectations for an increase of 1.5 million barrels.

Oil prices received some support earlier this week by expectations that China and the US were on the cusp of concluding phase one of their trade deal that would roll back much of the tit-for-tat tariffs. Gasoline and distillate supplies fell, while stockpiles stored at the Cushing, Oklahoma, storage hub rose 1.7 million barrels. Negotiators are also discussing lowering the 25 percent duty on about $250 billion of imports that Trump imposed past year, the people said.

Data Wednesday showed Germany's service sector barely grew in October, while euro zone business activity expanded slightly faster than expected, but remained close to stagnation.

Wednesday also saw the type of bad news/good news report that tends to mitigate losses, ie: word that Iran started to inject uranium gas into centrifuges at an underground nuclear facility, thus further violating the nuclear deal between the Islamic republic and world powers.

Middle East tensions offered some support.

Last year, US President Donald Trump exited the deal and renewed sanctions on Tehran, slashing Iran's economically vital crude oil sales by more than 80%.

However, Russian energy minister Alexander Novak said the current oil price of more than $60/Bbl showed markets were stable.

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