Oil market climbs before U.S. energy report

World oil prices rose Thursday on expectations that the latest U.S. stockpiles report will show a further dip in crude reserves as traders worry about a global oversupply, analysts said.

In early afternoon London deals, Brent North Sea crude for July added 29 cents to $62.35 per barrel, compared with Wednesday’s closing level.

U.S. benchmark West Texas Intermediate (WTI) for delivery in July won 24 cents to $57.75 a barrel.

The Department of Energy’s weekly petroleum report, usually released on Wednesdays, will be issued a day later owing to a U.S. public holiday on Monday

“Speculation that U.S. oil inventories could decline again in tonight’s weekly report appears to have attracted some relative support” to prices, said Nicholas Teo, market analyst at CMC Markets in Singapore.

Analysts expect inventories fell for a fourth consecutive week, by two million barrels, according to a survey by Bloomberg News. The stockpiles currently stand at 482.2 million barrels, just below record highs.

Dealers have been hoping a slowdown in U.S. output, coupled with increased demand during the summer driving season, could whittle down global supplies, which was a key reason for the collapse in prices of more than 50 percent between June and January.

Dealers are also closely monitoring a potential rise in Iraqi oil exports, which could exacerbate the global glut.

“On the global market, Iraq is planning to escalate its export by 26 percent to a record 3.75 million barrels per day in June,” said Sanjeev Gupta, head of the Asia-Pacific oil and gas practice at business consultancy firm EY.

“If the planned export is fulfilled, a global glut will persist,” he said.