By Summer Said and Dan Molinski 

Oil prices rose Thursday, reversing earlier losses, after a Saudi Arabia official said it doesn't plan to unnecessarily flood the market with oil.

Light, sweet crude for August delivery rose 1.1% to $69.84 a barrel on the New York Mercantile Exchange. Brent crude, the global benchmark, was 0.3% higher at $73.13 a barrel.

Concerns that Saudi Arabia and its partners are moving to substantially oversupply the market are "without basis," Saudi Arabia's governor to the Organization of the Petroleum Exporting Countries, Adeeb al-Aama, said in an statement.

He added Saudi Arabia is committed to the agreement between OPEC and its allies, and its crude oil exports in July will be roughly equal to their June levels, while in August they will drop by around 100,000 barrels a day.

Oil prices had fallen sharply in early July, in part due to indications that the Saudis and its OPEC partners would heed calls by U.S. President Donald Trump to takes measures that would reduce oil prices, which had hit multi-year highs in late June. Those high oil prices were pushing up gasoline prices for U.S. consumers.

"The OPEC Monopoly must remember that gas prices are up & they are doing little to help," Mr. Trump said in a July 4 posting on the social media site Twitter. "If anything, they are driving prices higher as the United States defends many of their members for very little $'s. This must be a two way street. REDUCE PRICING NOW!"

But Mr. Aama's comments Thursday would suggest the Saudis and other OPEC members don't plan to boost supplies simply because Mr. Trump said he wants lower gasoline prices for U.S. drivers.

The Saudi official said Saudi Arabia's policy is to work on satisfying customers' needs, but to do so while adhering to the production agreement.

Oil prices had been trading lower earlier in the session Thursday, hurt by a stronger dollar. Oil is traded in greenbacks, so crude prices tend to move in the opposite direction of the dollar.

Investors had pushed oil prices lower during the overnight session after a bearish report Wednesday on U.S. oil inventories. The weekly data showed U.S. crude oil stockpiles climbed by nearly 6 million barrels last week, while economists were expecting a decline.

Still, the Energy Information Administration report showed a big, bullish decline in gasoline supplies, and it also reported robust fuel demand that indicates the U.S. summer driving season is quite active.

"We saw incredible demand for gasoline, and those supplies fell by 3.165 million barrels. Distillates also fell by 371,000 barrels," said Phil Flynn at Price Futures in Chicago.

All in all, Mr. Flynn said more oil-market volatility is expected and the long-term outlook still signals a "big rally" at the end of the year. But he noted the market is "fighting outside forces with the rising dollar and fears about the longer-term impact of a trade war."

Among refined products, gasoline futures rose 0.1% to $2.0459 a gallon. Diesel futures gained 0.3% to $2.0972 a gallon.

--Christopher Alessi contributed to this article.

Write to Summer Said at summer.said@wsj.com and Dan Molinski at Dan.Molinski@wsj.com

(END) Dow Jones Newswires

July 19, 2018 12:34 ET (16:34 GMT)

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