SINGAPORE (Reuters) – Oil prices rose in early trading on Thursday, clawing back a part of the 6 percent slump in the previous session after a shock jump in U.S. crude inventories and record Saudi output, although analysts said sentiment remained bearish.
A 10.95 million barrel surge in U.S. crude stockpiles to 482.4 million, the biggest gain in 14 years, and Saudi oil production of 10.3 million barrels a day in March had battered crude futures on Wednesday.
The falls were pared on Thursday in an extension of the recent high market volatility that has seen frequent price reversals.
Brent May crude was up 61 cents from its last settlement, trading at $56.16 a barrel by 0035 GMT, while U.S. May crude rose 59 cents to $51.01 a barrel.
Close-to-close price volatility for Brent prices is at levels last seen during the height of the global financial crisis of 2008/2009, Reuters data shows.
Overall sentiment remains bearish due to high production and modest demand.
"We are seeing little sign of economic acceleration… and anticipate a meaningful decline in oil production is still a couple of months away," U.S. Bank Wealth Management said in a research note.
Because of slowing demand growth and soaring production, oil prices have dropped around 50 percent since June last year, when prices began to fall.
On the supply side, ConocoPhillips received U.S. government approval to export ultra-light domestic oil, making it the latest firm to obtain approval to export minimally processed, super-light oil known as condensate.
Others with similar approvals include Royal Dutch Shell and pipeline companies Enterprise Products Partners and Plains All American LP.