Oil prices gain as OPEC revises deficit forecast

Oil prices edged higher on Thursday with the market mood switching to relief as OPEC forecast a supply deficit next year, from doom and gloom over data showing a surprise increase in United States (US) crude inventories.

Brent futures rose 24 cents, or 0.4 per cent to $63.96 a barrel by 0242 GMT, after skidding 1 per cent on Wednesday on the US stocks build-up.

West Texas Intermediate crude was down 10 cents, or 0.2 per cent, at $58.85 a barrel, following a 0.8 per cent drop the previous session.

The Organisation of the Petroleum Exporting Countries (OPEC) on Wednesday said it now expected a small deficit in the oil market in the next year, suggesting the market is tighter than previously thought – even before the latest pact with other producers to curb supply takes effect.