2014.10.0100:03:13UTC+00WTI recovers from largest fall in nearly 2 years

West Texas Intermediate bounced back from its biggest drop in almost two years with data on the strength of oil demand in the US, the largest consumer of the commodity in the world, incoming.

Futures for the American crude oil benchmark with a delivery date in November increased by as large as 0.4%, or 39 cents, for a price per barrel of $91.55. It was trading mid morning Singapore time at $91.44 on the New York Mercantile Exchange. The benchmark declined by $3.41 yesterday to fall to $91.16, its lowest closing value since May 1st, 2013. Trading volume for futures was 41% less than the 100 day average. Prices for WTI have fallen by 7.1% so far this year, including a 13% drop in the third quarter.

Analysts surveyed by Bloomberg News predict that today’s report from the Energy Information Agency will show that stockpiles of crude oil in the US increased by 1.5 million barrels during the week that ended on September 26th, while supplies of gasoline are seen to have shrunk by 600,000 barrels.

Barclays Plc and UBS AG claim that global oil prices will start to recover with Saudi Arabia, the Organization of Petroleum Exporting Countries’ largest producer, reducing its output alongside increasing demand around the world. The OPEC member reduced its output levels in August by the biggest margin in 20 months and is looking to keep production low for the duration of the year.  The International Energy Agency claims that consumption will increase by 600,000 barrels daily through December.

Brent, the European benchmark, with a delivery date in November climbed up by 0.3%, or 25, cents, to arrive at a price per barrel of $94.92 after falling to its lowest close since June 28th, 2012 at $94.67. It traded with a premium over WTI of $3.53 in London’s ICE Futures Europe exchange.