Crude oil prices moved higher on Wednesday as investors bought back into the market after a five-day slide.

Oil prices had slumped more than 3 per cent on Tuesday after a surprise surge in the value of the dollar due to strong construction data in the US and the European Central Bank reaffirming its economic stimulus program, which hit the euro.

“Currency effects on crude oil tend to only have immediate effects on crude prices,” said Daniel Ang, investment analyst at Phillip Futures in Singapore. “However, in the longer run, we rely on supply and demand. Therefore, for the rest of today, we expect some price adjustments for both WTI and Brent before US inventory data.”

July contracts for Brent crude, the global benchmark, were up $US0.8, or 1.2 per cent, at $US64.82 a barrel on the ICE Futures Europe exchange. Light, sweet crude for July delivery was up or 0.9 per cent at $US58.55 a barrel on the New York Mercantile Exchange.

Mr Ang said he expects weekly US inventory data, to be released from the US Energy Information Administration later Wednesday, to show a decline in production.

Harry Tchilinguirian, head of commodity strategy at BNP Paribas, said US oil supply is quite resilient and producers can be profitable even at the current oil prices.

“Once you get to $US60 a barrel, production is possible, and there is a lot of hedging going on,” he told attendees at the Platts Global Crude Oil Summit. The US has often been called the new swing producer on the global market as its output continues to rise. But the US ban on crude exports makes it hard to be a true swing producer, said Mr Tchilinguirian.

Meanwhile, analysts at JBC Energy said the recent data showing Saudi Arabian crude exports were close to a 10-year high in March shouldn’t lead to the assumption the kingdom will continue to prioritize exports. The surge came even as Saudi Arabia’s own domestic consumption fell, so to keep exports stable at March levels would need Saudi Arabia to cut back on its own consumption, they said.

As temperatures soar for summer and Saudis turn up their air conditioning, domestic demand should rise, said JBC Energy’s team. Ramping up production even further “seems unlikely given the already historically strong March supply figure,” they say. “We therefore expect to see a dip in crude export levels in the months to come.”

Gasoline futures recently were up 1.3 per cent to $US2.0208 a gallon. Nymex diesel futures were up 1 per cent at $US1.9475 a gallon.

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