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Oil climbs again as industry decides to 'wait and see'

Mar 30, 2016, 13:47 IST

Tokyo businessmen are reflected in an electronic board showing exchange rates between (from top row to third row) the Japanese yen against the U.S. dollar, the euro, Australian dollar and (fourth row to bottom row) indices of Dow Jones, the NASDAQ and Hang Seng Index, outside a brokerage in Tokyo April 14, 2014.REUTERS/Issei Kato

Oil prices jumped on Wednesday, rebounding from a bad Tuesday, which many thought spelled the end of the recovery.

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West Texas Intermediate (WTI) Crude oil was at $38.91 (£26.95) as of 8:25 AM GMT, up 2.4% from a low of $37.99 the evening before.

Brent crude oil managed to go above the $40 mark at $40.38 (£27.97), up 2.3% from $39.54 16 hours ago.

The rebound is being put down to the Asian markets, who were pleased with a less than expected build in crude oil stockpiles according to Reuters.

It seems the industry is also waiting to see just how much stockpiles have built up.

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"There's a little bit of steadying in oil prices in the Asian time zone. The predominant attitude is one of wait-and-see until the Energy Information Administration [EIA] inventory figures come out," said Ric Spooner, chief market analyst at Sydney's CMC Markets.

This means the price rebound may not last for long, as the EIA figures are expected to show a 3.3 million barrel buildup, a record high for the seventh straight week.

This chart shows the small rise of WTI crude oil on Wednesday morning:

Investing.com

Brent crude oil also rose at a similar rate, though it currently stands at a higher price:

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Investing.com

Meanwhile, CNBC reports that the oversupply issue could get worse as Kuwait and Saudi Arabia said on Tuesday that they would resume production at the jointly operated Khafji field, which had been producing between 280,000 and 300,000 barrels per day back in 2014.

OPEC and other major oil suppliers, including Russia, are due to meet in Qatar on April 17 to discuss the oversupply crisis and potential price freezes.

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