European reports of modest, though uneven, economic growth were enough to help lift crude oil prices back from the brink of sub-$30 in early Thursday trading. File photo by Monika Graff/UPI | License Photo
NEW YORK, Jan. 14 (UPI) -- Broad signs of steady, albeit uneven growth, in the global economy and resilience in London gave crude oil prices a shot in the arm in Thursday trading.
Crude oil prices managed to end trading Wednesday modestly higher after as key indices flirted with dropping below $30 per barrel in midday trading. Crude oil prices have moved steadily lower since the start of the year amid concerns about the pace of growth in the Chinese economy.
A survey from the European Central Bank found world economic growth continued to build, though the pace was uneven. In the countries that use the euro, gross domestic product increased in the third quarter by about 0.3 percent from the previous term.
European woes have contributed to downward pressure on crude oil prices, a situation compounded last year by worries about the Greek debt crisis.
In London, the Bank of England said it expected the decline in crude oil prices would only put modest pressure on inflation, adding policymakers moved in broad support for keeping interest rates at a record low.
Crude oil prices carried Wednesday's momentum forward into the start of trading in New York. Brent crude oil gained 0.75 percent early in the session to $30.54 per barrel. West Texas Intermediate, the U.S. benchmark price for crude oil, rallied 1.3 percent to gain a rare premium to Brent, opening at $30.90 per barrel.
Thursday's rally may be supported by data from the U.S. Energy Information Administration showing only a slight build of 200,000 barrels in commercial crude oil inventories for the week ending Jan. 8, which suggests some demand may be returning to the market. EIA data for the week ending Dec. 25 showed an increase of 2.6 million barrels.
A report from the U.S. Federal Reserve found broad-based declines in the energy sector as oil and prices continued to fall. Elsewhere, however, the Fed found mixed support in some parts of the U.S. economy, though labor improvements were offset by "flat to moderate" wage increases.
Thursday's rally may be influenced by the imminent release of sanctions on Iran as nuclear energy officials there work to seal some of their reactors with concrete in order to meet the terms of last year's multilateral agreement.