US West Texas Intermediate (WTI) crude futures were trading at USD 40.88 per barrel at 0031 GMT up 13 cents from their last settlement.
The contract fell below USD 40 for the first time since August yesterday and traders said that the slight gains were more a result of short covering than a more bullish sentiment.
Overall, oil markets remain oversupplied with rising US stockpiles the most visible evidence.
"Rising US crude stockpiles continue to remain a major (downward) driver of price," ANZ bank said today.
US crude inventories grew by 252,000 barrels last week to 487.3 million barrels close to record highs according to data from the Energy Information Administration (EIA) highlighting
that more crude is being produced than needed.
As a result, US crude futures have been struggling to break higher this week although ANZ said that rising crude demand from US refineries was also preventing prices from falling much further.

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