On Wednesday, oil rallied as much as 5 percent, with U.S. crude hitting three-month highs of $38.51 a barrel as a big gasoline inventory drawdown overshadowed record high crude stockpiles.
But some analysts said last week's gasoline stock build, which was triple expectations, could be partly due to the market transitioning from winter-grade to summer-grade motor fuel. They also said the U.S. refinery maintenance season could push crude stockpiles to even bigger highs.
Global demand for crude oil typically dips when refineries around the world enter seasonal maintenance in spring, ahead of peak summer demand.
Some analysts fear that despite the big U.S. draw, gasoline stocks remained high on both sides of the Atlantic, which could undercut a sustained recovery in oil prices. Crude's 30 percent rise in the last month was partly based on hopes that drivers would soak up the surfeit in the fuel.
"The gasoline drawdown is great but we still have record high crude stocks. The question is whether we are just going to depend on falling U.S. production to bring that down, or OPEC will also get its act together on an output freeze," said David Thompson at Washington-based commodities brokerage Powerhouse.
Traders were also focused on a potential agreement to rein in output between producers from the Organization of the Petroleum Exporting Countries, led by Saudi Arabia, and non-OPEC exporters including Russia.
A meeting to discuss a global pact on freezing production is unlikely to take place in Russia on March 20, sources familiar with the matter say, as OPEC member Iran is yet to say whether it would participate in such a deal.
"The idea that meeting may not happen at all is definitely weighing on the market," said Tariq Zahir, who mostly trades in U.S. crude oil spreads at Tyche Capital Advisors in New York.