Oil Up, But Forecasts Down - Again

A bigger than expected drop in U.S. crude stocks wasn't enough to inspire market confidence.

Crude market doldrums continued on Thursday, with oil futures settling slightly up but well off session highs, which caused a predictable round of dire near-term forecasts based on the contention that we're nowhere near to achieving anything that could remotely be described as a proper supply and demand balance.

West Texas Intermediate rose 39 cents to settle at $45.52 per barrel and Brent settled up 32 cents to $48.11.

The modest gains were attributed to U.S. Energy Information Administration data showing that American crude stocks fell 6.3 million barrels, much more than the draw of about 2.3 million barrels analysts had forecast.

Phil Flynn, senior market analyst at Price Futures Group Inc., stated, "The market is still believing supplies are not going to be in balance globally."

Sam Margolin, oil analyst at Cowen, told CNBC's`Squawk on the Street' that "We got much more bearish over the past few months" and added that with increased Organization of the Petroleum Exporting Countries (OPEC) exports combined with Nigeria and Libya coming back into production force, along with cuts "that really haven't had any effect at all," plus conflicts within the Middle East, "that's going to be really problematic for the outlook for the rest of the year....eventually demand will overwhelm supply...but in the near term it doesn't look very constructive."

Participants of CNBC's `Fast Money Halftime Report' were also concerned about where the market is headed, with one pointing out that rising tensions between the U.S. and North Korea are "detrimental to demand"; another said that fundamentals will keep crude hovering around the $45 mark.

Capping the gloomy prognostications was Saxo Bank, which said oil prices could rise toward $55 in coming months, but it expected lower prices at year-end and into 2018.

The best that could be said about Thursday's round of opinions was that nobody predicted oil in the $30s, as has been the case ever since it became evident that OPEC's highly-touted cutbacks weren't working; the last time that perilous level was mentioned was in a CNBC Oil Survey of earlier this week, in which 60 percent of respondents said the bottom for crude is likely to be in the low $40s and 70 percent did not rule out a further drop below that.