(Bloomberg) -- Oil closed little changed after rallying to a five-week high earlier in the day as investors re-focused on the uncertain outlook for global demand.
Futures in New York earlier rose as much as 2.7% on Thursday. While the U.S. government reported a nearly 5 million-barrel draw in domestic crude inventories, concerns linger that global growth may stall if trade talks between the U.S. and China in October don't yield a positive result.
"There is the specter of diminished global demand at a time when U.S. production is still strong," said Gene McGillian, a senior analyst and broker at Tradition Energy in Connecticut. "Uncertainty surrounding global demand from the U.S.-China trade dispute continues to hold the market back."
Futures in New York hit a five-week intraday high during the session on reports that the U.S. and China would hold trade talks next month and as the market reacted to depleting inventories in the U.S., with stockpiles at the key Cushing, Oklahoma storage hub at the lowest since December 2018.
West Texas Intermediate for October delivery edged higher by 4 cents to settle at $56.30 a barrel on the New York Mercantile Exchange.
Brent for November settlement rose 25 cents to end the session st $60.95 a barrel on the ICE Futures Europe Exchange. The global benchmark crude traded at a $4.79 premium to WTI for the same month.
The EIA report showed that while U.S. crude stockpiles are at the lowest level in almost a year, crude production is near record-high levels.
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To contact the reporter on this story: Sheela Tobben in New York at vtobben@bloomberg.net
To contact the editors responsible for this story: David Marino at dmarino4@bloomberg.net, Jessica Summers, Reg Gale
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