Oil prices rose above $77 a barrel on Thursday in Asia, rebounding slightly after unexpected jumps in US crude and gasoline supplies the previous day suggested demand remains sluggish.
Benchmark crude for January delivery was up 55 cents to $77.15 at late afternoon Singapore time in electronic trading on the New York Mercantile Exchange.
The contract dropped $1.77 to settle at $76.60 on Wednesday after the Energy Information Administration said oil supplies grew unexpectedly last week
Crude stocks rose 2.1 million barrels while analysts had expected a drop of 1.3 million barrels, according to a survey by Platts, the energy information arm of McGraw-Hill Cos. Gasoline inventories jumped by 4 million barrels, more than the 900,000 analysts expected.
Oil has been trading in a range between $75 and $82 for about two months, supported by evidence of improving demand in China and Japan, but capped by a tepid economic recovery in the US.
"There are no such signs (of strong demand) yet in the U.S. data," Barclays Capital said in a report. "As for many weeks, the U.S. market does seem to be in something of a stasis, waiting for either winter or the long-awaited rebound in trucking." In other Nymex trading in January contracts, heating oil rose 1.06 cents to $2.05 and gasoline gained 1.17 cents to $2.00. Natural gas climbed 4.2 cents to $4.57 per 1,000 cubic feet. In London, Brent crude for January delivery gained 74 cents to $78.62 on the ICE Futures exchange.