Oil hit a near six-year low on Tuesday, with U.S. crude paring some losses on short covering and reaching parity with Brent for the first time in three months, as traders continued to wonder when the six-month long price rout might end.
Oil prices are have already traded lower for seven consecutive weeks, and so far this week Brent is down 8 percent and U.S. crude down about 5 percent.
U.S. crude settled down 18 cents, at $45.89 a barrel, its lowest level since April 2009. Brent crude was down $1 at $46 a barrel after a session low at $45.19.
The arbitrage between U.S. crude and Brent crude oil futures traded at parity for the first time since October, with both markets at $46 a barrel at one point.
Traders said it was not immediately clear why the benchmarks converged, but analysts said it was a combination of oversupplied global markets coupled with short covering on the U.S. crude contract.
"The stock market rallied and that helped U.S. crude and the $44 a barrel level had been a target number for traders and U.S. crude held above that early on Tuesday," said Phil Flynn, analyst at Price Futures Group in Chicago.
Prices were little changed after the U.S. Energy Information Administration raised its 2015 world oil demand growth forecast by 120,000 barrels per day from its previous estimate. In its monthly forecast, EIA projected 2016 world oil demand to hit 93.42 million bpd, up 1.03 million bpd from 2015.