By Amrith Ramkumar 

Oil-market analysts are struggling to discern whether a recent rise in crude inventories is signaling excess supply ahead or is a result of lower refining activity, adding to the complicated signals buffeting prices.

U.S. crude futures swung between gains and losses Thursday after the latest stockpile data before closing up 1.1% at $53.93 a barrel on the New York Mercantile Exchange. They are still down 19% from their April peaks on fears that soft demand and steady production will result in a supply glut. Brent crude, the global gauge of prices, added 0.8% to $59.91 a barrel on the Intercontinental Exchange.

Prices were little changed following Energy Information Administration figures showing that U.S. inventories surged 9.3 million barrels during the week ended Oct. 12, a much larger rise than the 2.3-million-barrel increase expected by analysts and traders surveyed by The Wall Street Journal.

Stockpiles are about 2% above their five-year average for this time of year and U.S. production stayed at a record 12.6 million barrels a day last week, signaling that there is plenty of crude available.

At the same time, inventories of gasoline and distillates fell more than analysts had anticipated and refinery activity remained muted in part due to seasonal maintenance, the report showed. Many refineries that turn crude into fuel products undergo maintenance in the fall because demand tends to wane during this time of year. Once refining activity picks up again, inventories could decline.

In another encouraging sign for bullish oil investors, data on total products supplied, a measure of fuel consumption, show that demand is higher than it was at this time last year. Those figures could ease some fears of a sharper-than-expected slowdown in consumption that some expect to push prices even lower.

Traders are also weighing signs of thawing trade tensions between the U.S. and China, progress on Britain's exit from the European Union and a drop in global interest rates that could help the world economy stabilize and support demand.

Tensions in the Middle East have also given prices a bit of a boost at times this year as analysts try to gauge whether sustained supply disruptions could lead to shortfalls.

The complicated dynamics have caused both periods of heightened volatility and muted moves in oil prices, which have often shrugged off supply and demand figures in recent months due to the changing sentiment in the market. That was the case again Thursday, when prices stayed in their recent range after the biggest one-week rise in U.S. crude stockpiles since late April.

Another factor helping commodities Thursday was a decline in the dollar, as a weaker U.S. currency makes assets priced in dollars cheaper for overseas buyers.

Write to Amrith Ramkumar at amrith.ramkumar@wsj.com

(END) Dow Jones Newswires

October 17, 2019 15:20 ET (19:20 GMT)

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