U.S. crude dipped into and out of negative territory mid-morning Wednesday, after U.S. government data showed a surprise dive in crude stockpiles in the past week, but a build to record levels at the key delivery point in Oklahoma for the West Texas Intermediate contract.
The Energy Information Administration reported U.S. commercial crude inventories capsized 754,000 barrels to a total of 502 million barrels, as refinery runs and exports fell from the previous week. Analysts had expected at 3.6-million-barrel leap.
However, U.S. crude stocks at Cushing, Oklahoma hit a new record last week after rising 523,000 barrels to 64.7 million barrels, according to the EIA data
U.S. weekly commercial crude oil imports recorded the biggest week-on-week decline last week since December 2014, data showed, falling to 7.1 million barrels per day from the previous 8.3 million bpd
Brent crude was up 72 cents at $31.04 U.S. a barrel by late morning. The contract fell for a fourth straight session on Tuesday to end down 7.8%. U.S. crude prices erased eight cents at $27.86 U.S. after falling as low as $28.31.
Prices had recovered earlier on Wednesday, a day after posting its third-biggest daily fall since the financial crisis, on talk major producers might tackle a glut that has sent prices to 12-year lows.
Iran's oil minister said Tehran was ready to negotiate with Saudi Arabia and his Russian counterpart proposed producing countries reduce output by one million barrels per day - without saying whether non-OPEC member Russia would actually cut its production.
