LONDON - World oil prices rose Thursday after volatile trading the previous day as traders digested a sharp rise in US gasoline reserves, dealers said.
New York's main contract, light sweet crude for delivery in June, jumped 42 cents to 50.55 dollars per barrel in early deals. It slumped Wednesday to 48.80 dollars, below 49 for the first time since February 18, following publication of the stocks data.
In London on Thursday, the price of Brent North Sea crude oil for delivery in June gained 29 cents to 51.26 dollars per barrel. Brent crude fell to 49.66 dollars the day before, the lowest level since March 1.
Oil prices dipped Wednesday on news of the sharp weekly rise in US gasoline stockpiles but began rebounding as speculators took advantage of a volatile market.
Oil prices "rose despite weekly US data which showed that crude oil stocks reached their highest level" for more than three years, they added.
The US Department of Energy (DoE) said crude stocks for the week ending April 29 jumped 2.6 million barrels to 327 million, against a predicted rise of 1.25-1.5 million
Supplies of gasoline rose 2.2 million barrels to 213.5 million, beating market expectations of an increase of 750,000-875,000 barrels.
Gasoline, or petrol, was in focus ahead of the so-called driving season in the United States, when many Americans take to the road for summer vacations.
The rally in oil prices (on Wednesday) looked to be due to short covering -- traders buying back previously sold stock -- as the market failed to break a key technical level despite the bearish data, Sucden analysts said.
"Further losses are expected although it is evident that there is still plenty of buying in the market," they added.
Mark Pevan, an analyst with Daiwa Securities in Melbourne, said the market was in the midst of adjusting to the new price levels, which had fallen from historic highs of above 58 dollars in early April.
"It was more of a rebound more than any positive news," said Pevan, adding that the market would remain turbulent in the short term.
"Prices look to be volatile in the next month or two but we should see improvement in the third quarter as the impact of slightly higher supplies sinks in."

05/05/2005 16:30 GMT