Singapore: Brent futures edged higher on Friday, holding above $48 a barrel on positive technical price momentum, although few analysts expect a strong rebound anytime soon as global output continues to outweigh demand.
Still, crude markets may be bottoming out, analysts said, as prices were receiving support around current levels.
"Our forecast seems to point towards a consolidation stage in the weeks to come," Phillip Futures said in a note. "Therefore, we expect crude prices to trade range bound between $44.75-$50.69 for WTI Mar`15 and $46.4-52.89 for Brent Mar`15."
Benchmark Brent crude futures were trading at $48.59 per barrel at 0435 GMT, up 32 cents since their last settlement. US crude was trading at $46.59 a barrel, up 34 cents.
Despite the slight price gains, oil opened up into a wobbly market after Switzerland jolted markets already roiled by plunging commodities prices by abandoning its currency cap on Thursday. The move triggered the euro`s biggest one-day drop fall against the Swiss franc in history and an 11-year low against the US dollar.
Investors took this as a sign that the European Central Bank would launch large-scale bond buying next week, which points to further euro falls against the dollar.
"The potential dollar strength into 2015 may be another factor at play in pressuring oil prices lower. The weakness in the crude space is likely to keep sentiment jittery," Singapore`s OCBC bank said on Friday.
Oil markets remain dominated by oversupply - created by soaring US shale output and high production from OPEC members and Russia - amid slowing demand.
Crude oil prices have been pulled lower by multiple factors, OCBC said, starting back in July 2014, when oversupply from major oil producers spooked the market.
"In contrast, demand stayed tame, with European and Indian demand trending in the contraction zone," it said.
