Oil prices rise after ECB suggests expanded stimulus

Oil prices rose for a second straight day on Thursday after the European Central Bank indicated more stimulus could be on its way for the eurozone.

US benchmark West Texas Intermediate for October delivery was up 50 cents to $46.75 a barrel on the New York Mercantile Exchange.

Brent North Sea crude for October, the global benchmark, closed at $50.68 a barrel in London, a gain of 18 cents from Wednesday's settlement.

The president of the ECB, Mario Draghi, said the central bank could ramp up its bond purchase program if an additional boost is warranted in the faltering eurozone.

In a news conference after an ECB monetary policy meeting, Draghi said the program, known as quantitative easing, was "intended to run until the end of September 2016, or beyond, if necessary."

Draghi's remarks gave a lift to oil markets, which echoed climbs in equity markets, despite the news the ECB cut its economic growth and inflation in the single-currency area for 2015-2017.

"This is the latest cycle of 'bad news is good news,' with investors more pleased with the idea of ongoing stimulus than they are worried about poor demand," said Tim Evans at Citi Futures.

"Prices may be able to stage short-term rallies -- if the wind blows hard enough even turkeys can fly -- but we continue to see the market as physically oversupplied."

The supply glut, in combination with the weakening global economy, has pushed oil prices down more than 50 percent since their mid-2014 peaks.

Oil futures, like other markets, have been on a wild ride since China's surprise currency devaluation on August 11, which heightened concerns about the slowdown in its economy, the world's largest energy consumer.

An extended run of Chinese market volatility that has been weighing on confidence was absent Thursday because Chinese markets were closed for a long holiday weekend.

"A lot of the uncertainty on the oil market has been generated by what's been happening in China," said Gene McGillian at Tradition Energy.

"Maybe part of the reason it is stabilizing is that there is a trading holiday in China... so the market could be catching its breath."