Oil stood little changed around $40 a barrel on Thursday, after falling the previous day on lower share prices and after data showed US crude inventories rose under the weight of an economic slowdown. Crude stocks in the world's top energy consumer jumped by 7.2 million barrels to an 18-month high last week, data from the US Energy Information Administration showed.
US light crude for March delivery ticked up 3 cents to $40.35 a barrel at 0622 GMT, having earlier risen 20 cents. That is about $4 below London Brent crude for the same month, which gained 25 cents to trade at $44.40 a barrel.
NYMEX crude for April delivery is also around $4 a barrel pricier than for March delivery, with the contango firming to more than $13 a barrel towards the end of the year, creating an opportunity for traders to profit from storing crude for later use and showing they may be betting on a recovery late this year.
On Thursday, Asian shares edged up cautiously for a third straight session, providing some support for oil prices battered by economic concerns as hopes for a recovery in China's economy raised confidence about the outlook for global trade.
"The tenacity that WTI crude oil prices have shown over the past couple of weeks by being able to hold on at or above $40 per barrel is incredible given what seems to be a near unstoppable flow of bad fundamental news," said Martin King, an analyst at First Energy Capital.
Adding further to the economic gloom, US non-farm payrolls, due out on Friday, are estimated to have shed more than half a million jobs in January after losing a similar number in December as employers, fearing the impact of a weak economy on sales and profit, shrank their work forces to cut costs.
A global financial crisis, which started with a downturn in the US housing market, has triggered recessions in all of the big industrialised economies, sharp slowdowns elsewhere and put millions of jobs on the line. That in turn has cut the demand for oil and swelled fuel stocks, knocking more than $100 a barrel off the price of crude since its July 2008 peak near $150.
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