Oil Ignores Data, Posts Small Gain

Two days ahead of OPEC's meeting in Vienna, oil futures snapped a three-day losing streak as traders tepidly embraced riskier assets following a market-wide sell-off on Monday. NYMEX-traded crude for July delivery added 62 cents, or 0.7%, to finish the day at $83.32 a barrel. In London, Brent crude for July delivery lost 86 cents to close at 97.14 per barrel. A weaker dollar also helped lift oil today as the PowerShares DB US Dollar Index Bullish (NYSE: UUP) finished slightly lower. While oil remains joined at the hip with any news flow out of Europe, headlines from across the Atlantic were docile for a change, allowing traders to erase Monday's losses. Still, Brent crude, the global benchmark, resides at 17-month after Tuesday's loss. Amid rising inventories and lingering concerns about Europe's progress toward resolving its sovereign debt crisis, oil is walking a fine line between breakout and breakdown these days.

The U.S. Energy Information Administration lowered its 2012 global demand growth forecast today by 150,000 barrels to 810,000 barrels per day. The EIA said it had increased its forecast for non-OPEC crude oil and liquid fuels production growth in 2012 by 120,000 barrels per day to 800,000 barrels per day, taking total non-OPEC output to 52.72 million barrels per day, Reuters reported.

EIA noted North America, thanks to the Canadian oil sands region and various U.S. shale plays, is leading the way in terms of non-OPEC production. Combined, the U.S. and Canada are expected to see production increases of 890,000 barrels per day this year. That may not be good news of U.S. oil inventories, which currently reside at 22-year highs, but it is good news for the U.S. economy as those numbers reflect a decreased dependence on crude from foreign sources that are less than friendly to the U.S.

With all three major U.S. indexes jumping more than 1% on the day, oil equities found some much-needed relief. Exxon Mobil (NYSE: XOM) gained more than 1% while rival Chevron (NYSE: CVX) flirted with a gain of that much. Both gains were accrued on light volume. International integrated oil names impressed to a greater degree. Royal Dutch Shell (NYSE: RDS-A) and BP (NYSE: BP), Europe's two largest oil companies, both flirted with gains of 2%.

Also on light volume, the major independents saw some nice gains, though not enough to erase the savagery they've fallen victim over the past six weeks. Apache (NYSE: APA) added almost 2% while Anadarko Petroleum (NYSE: APC) surged nearly 3%.

The U.S. Natural Gas Fund (NYSE: UNG) closed modestly higher, though it should be noted that fund has plunged more than 9% in the past week.