Picture: THINKSTOCK
Picture: THINKSTOCK

SINGAPORE — Oil prices eased on Wednesday as traders reacted calmly to the Brussels attacks and kept their eyes on global oversupply ahead of a crucial producers’ meeting in Qatar in April.

At about 3am GMT, US benchmark West Texas Intermediate (WTI) for May delivery was down 46c at $40.99 while Brent for May was 41c lower at $41.38.

"Oil prices are pulling back as the market reaction to the Brussels attacks was not as adverse as expected," IG market strategist Bernard Aw said in Singapore.

"The impact of terror activity on financial markets has lessened substantially in recent years. Economies and markets have a tendency to adjust and desensitise to such events over time."

Phillip Futures investment analyst Daniel Ang said: "We continue to believe that price movements are continually influenced by the current global oversupply.

"Fundamentals should still be bearish in the immediate term and we continue to believe that cuts to US production would be key further down the road."

He said there could be some price volatility if top Organisation of the Petroleum Exporting Countries (Opec) and non-Opec members agreed on a production freeze when they met in Doha on April 17.

But he added that a mere production freeze at January levels would not be enough to sustain an uptrend in oil prices, which were now more than 60% off a mid-2014 peak due to excess supply and slowing world demand.

"There have to be cuts to production if higher prices were to be favoured," he said.

WTI rose last week above $40 for the first time since December, boosted by a sharp drop in the dollar, which generally makes crude less expensive. Renewed optimism that producers would strike a deal to freeze output also buoyed prices.

Opec secretary-general Abdalla el-Badri said in Vienna on Monday that 15 or 16 nations would join the Doha talks.

He said he expected crude to show a "moderate" bounce after the talks.

AFP