Oil Prices Dip Before Inventory Report

U.S. crude-oil futures slipped Tuesday, facing a second day of losses, ahead of a report about weekly U.S. crude inventory.

Crude oil for September delivery  fell 16 cents, or 0.2%, to $106.40 an barrel in electronic trading.

The futures on Monday settled lower by 38 cents, or 0.4%, on the New York Mercantile Exchange “amid reports that Libyan oil production and exports were beginning to recover following a round of protests that had curtailed supply,” said Citi Futures energy futures specialist Tim Evans in a note late Monday. Evans highlighted that gasoline and heating-oil futures led price declines on Monday.

undefined

The news from Libya outweighed U.S. data favorable to energy-demand prospects. The Institute for Supply Management said its service index jumped to 56% in July from 52.2% in June. Economists had expected an increase to 53.1%, according to a MarketWatch survey.

The market on Tuesday will digest U.S. trade data, in which it will watch for signs about economic conditions in China and in Europe, and U.S. June job openings. That report will follow data released Friday that the U.S. economy created a less-than-expected 162,000 jobs in July.

Weekly supply data is due after the close of Nymex trading, and analysts polled by Platts expect that crude-oil stocks fell 2 million barrels in the week ended Aug. 2.

The report from the American Petroleum Institute is due at 4:30 p.m. Eastern time, and a separate report from the Energy Information Agency is expected on Wednesday.

Last week, the EIA reported an unexpected rise of 400,000 barrels in crude stockpiles. Crude oil stocks have fallen in four out of the five most recent reporting weeks. But at 364.6 million barrels, Platts said stockpiles were about 5.6% above the five-year average for the week ended July 26.

Analysts also expect gasoline stocks and distillate stocks to each fall by 1 million barrels.

On Tuesday, September Brent crude fell 28 cents, or 0.3%, to $108.42 a barrel on ICE Futures.

September gasoline  lost 1 cent, or 0.2%, to $2.94 a gallon. September heating oil  slipped a penny, or 0.3%, to $3.04 a gallon, and natural gas for September delivery  was unchanged at $3.32 per million British thermal units.

Source : Marketwatch