Investing.com - Crude oil futures rallied sharply on Thursday, one day after plunging almost 9%, as investors returned to the market to seek cheap valuations.
On the New York Mercantile Exchange, crude oil for delivery in March fell by as much as 2.18%, or $1.06, to hit a session low of $47.39 a barrel, before recovering to trade at $49.72 during U.S. morning hours, up $1.27, or 2.62%.
A day earlier, New York-traded oil futures plunged $4.60, or 8.67%, to settle at $48.45 after data showed that oil supplies in the U.S. rose to the highest level on record last week.
The U.S. Energy Information Administration said that U.S. crude oil inventories rose by 6.3 million barrels last week to 413.1 million, the most in records dating back to August 1982.
West Texas Intermediate oil futures rose nearly 19% in the four sessions to Wednesday, amid indications U.S. producers are pulling back on new production in response to low prices.
Elsewhere, on the ICE Futures Exchange in London, Brent oil for March delivery rallied $1.58, or 2.93%, to trade at $55.75 a barrel, after falling by as much as $1.06, or 1.95%, to touch a daily low of $53.10 earlier.
On Wednesday, London-traded Brent tumbled $3.75, or 6.48%, to close at $54.16.
Brent prices climbed almost 17% in the four sessions leading up to Wednesday.
Capital expenditure cuts by major oil companies combined with a sharp reduction in U.S. rig counts are helping support prices amid hopes it will alleviate a glut in global supplies.
Oil prices have fallen sharply in recent months as the Organization of Petroleum Exporting Countries resisted calls to cut output, while the U.S. pumped at the fastest pace in more than three decades, creating a glut in global supplies.
Meanwhile, investors remained wary of developments in Greece, after the European Central Bank said it would no longer accept Greek bonds as collateral for lending, shifting the burden on to Greece's central bank to provide additional liquidity for its lenders and increasing pressure on Athens.
Greece's government is seeking debt relief on its current €240 billion bailout, which has fuelled fears over a clash with its creditors that could bring about its eventual exit from the euro zone.
Athens main stock index plunged on Thursday, while the yield on Greek 10-Year bonds rose sharply to hover just below the 11%-level.
In the U.S., government data showed that the number of individuals filing for initial jobless benefits in the week ending January 31 increased by 11,000 to 278,000 from the previous week's revised total of 267,000.
Analysts had expected initial jobless claims to rise by 23,000 to 290,000 last week.
A separate report showed that the U.S. trade deficit widened to $46.56 billion in December from $39.75 billion in November, whose figure was revised from a previously estimated deficit of $39.00 billion. Analysts had expected the trade deficit to narrow to $38.00 billion in December.
Traders now looked ahead to the release of the latest U.S. nonfarm payrolls report on Friday, for further indications on the strength of the recovery in the labor market.
Market analysts expect the data to show that the U.S. economy added 234,000 jobs in January, slowing from a gain of 252,000 in December, while the unemployment rate was forecast to hold steady at 5.6%.
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