Oil prices slightly pared losses on Thursday after official government data showed U.S. crude stocks fell, contradicting an earlier industry report that weighed on prices.
Figures released by the Energy Information Administration showed U.S. commercial crude inventories fell by 2.8 million barrels to 462.2 million barrels in the week through Oct. 6. On Wednesday, the American Petroleum Institute had reported on Wednesday that stocks rose by 3.1 million barrels.
Gasoline stocks rose by 2.5 million barrels, compared with analysts' expectations for a 480,000-barrel drop. Distillate stockpiles, which include diesel and heating oil, fell by 1.5 million barrels, versus expectations for a 2.2-million-barrel decline, the EIA data showed.
Brent crude futures, the international benchmark for oil prices, were down 78 cents, or 1.4%, at $56.16 late morning Thursday. U.S. West Texas Intermediate (WTI) crude futures were down 83 cents, or 1.6%, to $50.47 per barrel.
Both contracts have rallied in the last three sessions following last week's sharp losses.
A deal led by the Organization of the Petroleum Exporting Countries helped lift oil prices from the $30.00 to $40.00 per barrel range in late 2016 and early 2017. But traders say supplies remain ample despite these cuts, thanks in large part to surging U.S. production.
OPEC and other producers including Russia agreed last year to reduce output by 1.8 million barrels per day (bpd) to prop up prices and the cuts, from January, have helped drain inventories.
OPEC is widely expected to extend its cuts beyond the current expiry date of end-March 2018.
