Oil prices rebounded more than $1 to $56 a barrel on Thursday, after a two-day decline, as a weakened dollar and industry spending cuts offset worries of a supply glut, industry sources told, SIA informs citing the Reuters.
U.S. March crude futures CLc1 were trading up $1.34 at $50.18, after falling more than 2 percent in the previous session.
The dollar fell 0.33 percent against a basket of currencies .DXY.
"The dollar is weaker against all the commodities at the moment. We saw a heavy selloff in commodities yesterday and I think that's why we're getting a little bit of a rebound in oil prices on the back of that" said Michael Hewson, chief analyst at CMC Markets.
French oil major Total announced on Thursday that it would increase cuts to operational costs to $1.2 billion this year while spending 30 percent less on exploration, to cope with weaker oil prices.
Traders have been torn between early signs lower prices will eventually curb production and indications the market will remain oversupplied in the first six months of this year.
U.S crude stocks rose to a record weekly high last week, while gasoline stocks increased and distillate inventories fell, data from the Energy Information Administration showed on Wednesday.
On Wednesday, Saudi Arabia's oil minister met the chairman of Russian state-controlled energy giant Gazprom, Saudi state media said, and discussed cooperation between oil producers belonging to the Organization of the Petroleum Exporting Countries and non-members such as Russia.
Saudi Arabia will keep March crude supply to Asia steady.