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Oil futures rise as commodity rally holds

Published 22/03/2016, 11:35 am
© Reuters.  Oil futures rise as commodity rally holds
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TOKYO, March 22 (Reuters) - Oil prices rose in early Asian trade on Tuesday, adding to gains from the previous session after data showed U.S. crude inventories fell for the first time since January and as commodity prices broadly strengthened.

U.S. crude futures for May, the front month from Tuesday, were up 10 cents at $41.62 a barrel at 0026 GMT

The previous front month gained 47 cents, or 1.2 percent, to settle at $39.91 before expiring on Monday. The May contract finished up 38 cents at $41.52 on Monday.

Brent crude futures for May delivery LCOc1 were 8 cents higher at $41.62.

On Monday, the contract climbed 0.8 percent to $41.54 a barrel. Brent has risen more than 50 percent from 12-year lows in January.

"The current risk-on environment remains conducive for commodity prices to consolidate after a strong rebound in the last six weeks," ANZ said in a morning note.

"However, a further improvement in fundamentals will be needed for bulks, crude oil and base metals to rally further."

Stockpiles at the Cushing, Oklahoma delivery hub for U.S. crude fell 570,574 barrels to 69.05 million in the week to March 18, traders said on Monday, citing data from market intelligence firm Genscape.

Cushing inventories had previously risen toward 70 million barrels, causing market participants to fear they could hit capacity.

Iran may join other oil producers planning to freeze production to support prices at a later date, OPEC's secretary general said on Monday, as the country is seeking to raise its exports after Western sanctions were lifted on Tehran in January.

Producers from the Organization of the Petroleum Exporting Countries and non-members are due to meet on April 17 in Qatar discuss the output freeze.

Iran is keen to increase its oil exports, which fell by more than half during the sanctions over Tehran's disputed nuclear programme, and has said it should not be bound by a production freeze until it can recover its market share.

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