Oil rose before weekly U.S. stockpile data, snapping a three-day losing streak that had pushed prices to close below $30 a barrel.
Futures climbed as much as 2.1 percent in New York after dropping 3.9 percent Monday. Inventories probably expanded by 3.2 million barrels last week, according to a Bloomberg survey before an Energy Information Administration report Wednesday. North American oil and natural gas drillers will need to cut an additional 30 percent from their capital budgets to balance spending even if crude rises to $40 a barrel, according to an analysis by IHS Inc.
Oil is still down about 18 percent this year on speculation a global glut will persist amid the outlook for increased exports from Iran after the removal of international sanctions and brimming U.S. crude supplies. The nation’s drillers idled the most rigs since April last week as inventories rose above 500 million barrels to the highest level since 1930.
West Texas Intermediate for March delivery rose as much as 61 cents to $30.30 a barrel on the New York Mercantile Exchange and was at $30.16 at 8:45 a.m. Hong Kong time. The contract dropped $1.20 to $29.69 on Monday, the first time the contract has closed below $30 since Feb. 2. Total volume traded was about 65 percent below the 100-day average. Prices lost 30 percent last year.
Brent for April settlement slid $1.18, or 3.5 percent, to $32.88 a barrel on the London-based ICE Futures Europe exchange on Monday. The European benchmark crude ended the session at a premium of $1.24 to WTI for April.