Oil rebounds after sliding 5% overnight

Oil prices rebounded on Thursday in Asia after plunging almost 5% overnight on rising crude stockpiles.

US Crude Oil WTI Futures jumped 3.1% to $52.69 by 1:08 AM ET (05:08 GMT), while International Brent Oil Futures gained 2.9% to $57.88.

Oil prices were supported today by reports of possible producer actions to prop up oil markets.

Citing an unnamed official from Saudi Arabia, Bloomberg said the world’s top exporter contacted other producers and is in talks to take action to halt the slide in prices.

Oil prices slumped overnight after the US Energy Information Administration (EIA) reported in its weekly oil inventory dataset that crude stockpile rose by 2.39 million barrels in the week to August 2.

That was compared to forecasts for a stockpile draw of 2.85 million barrels, after a decline of 8.5 million barrels in the previous week.

The EIA also reported that gasoline inventories unexpectedly surged by 4.44 million barrels, compared to expectations for a draw of 0.72 million barrels, while distillate stockpiles increased by 1.53 million barrels, compared to forecasts for a gain of 0.48 million.

Ongoing Sino-US trade war was also cited as a headwind for oil prices.

Hopes of a quick trade deal diminished after the US slapped additional tariffs on more Chinese goods.

Tensions escalated further after the People’s Bank of China reportedly devaluated the yuan this week, prompting Washington to label Beijing as a currency manipulator.

China and the US are the world’s biggest oil importers.