Oil prices rebounded from earlier losses today on the back of a weak dollar, but an International Energy Agency (IEA) report flagging slowing demand growth this year and a larger-than-expected jump in US crude inventories capped gains.
Brent crude futures were up 53 cents, or 0.7%, to $82.13 a barrel by 1456 GMT. US West Texas Intermediate crude futures gained 52 cents, or 0.7%, at $77.16.
The US dollar index slid 0.4% after data showed US retail sales fell more than expected in January.
Retail sales dropped 0.8% last month, the Commerce Department's Census Bureau said on Thursday. Data for December was revised lower to show sales rising 0.4% instead of 0.6%, as previously reported.
A weaker dollar usually boosts oil prices as it makes the commodity cheaper for holders of other currencies.
Further oil price gains were limited by an IEA report on Thursday which said that global oil demand is losing momentum, prompting the agency to trim its 2024 growth forecast to 1.22 million barrels per day (bpd) from 1.24 million bpd.
On the supply side, the IEA estimated that supply will grow by 1.7 million bpd this year, up from its previous forecast of 1.5 million bpd.
Both oil benchmark contracts lost more than $1 a barrel on Wednesday, pressured by the rise in U.S. crude inventories as refining dropped to its lowest levels since December 2022.
The Energy Information Administration (EIA) said UScrude inventories jumped by 12 million barrels to 439.5 million barrels in the week to Feb. 9, far exceeding the rise of 2.6 million barrels expected by analysts in a Reuters poll.
"This uptick in inventories is attributed to a further decrease in refinery operations and relatively softer demand for petroleum products," said Ole Hvalbye, an analyst at SEB.
News that two major economies began recessions also weighed on prices.
Britain fell into recession in the second half of 2023 when its gross domestic product (GDP) contracted by 0.3% in the fourth quarter, having shrunk by 0.1% in the third quarter, official data showed.
Japan unexpectedly slipped into recession at the end of last year, surrendering its title as the world's third-biggest economy to Germany.
