Crude-oil futures fell Wednesday in electronic trade, stretching losses into a third straight day as U.S. President Barack Obama said diplomatic measures may resolve a dispute with Syria over its alleged used of chemical weapons.
Crude oil for October delivery fell 27 cents, or 0.3%, to $107.11 a barrel after Obama in a televised speech said he was sending U.S. Secretary of State John Kerry to Geneva to meet Russian Foreign Minister Sergey Lavrov to work on a plan to have Syria turn over its chemical weapons stockpile to the international community.
With a diplomatic process in motion, Obama asked Congress to delay a vote on whether to authorize military strikes.
Oil prices last week jumped about 3% after the Obama administration pressed for a military response in Syria, saying President Bashar al-Assad’s regime used chemical weapons against civilians in a deadly attack late last month.
But futures prices on Tuesday fell 1.9% as Syria’s foreign minister reportedly agreed to Russia’s proposal to relinquish control of its chemical weapons to avert a U.S. military attack. On Monday, oil prices pulled back from their highest level in more than two years.
Oil prices late Tuesday stayed lower, even though a report showed weekly crude supplies fell by more than expected. The American Petroleum Institute said supplies fell 2.9 million barrels for the week ended Sept. 6, according to sources. Analysts polled by Platts had been looking for a decline of 2 million barrels.
But gasoline stockpiles rose 195,000 barrels, compared with expectations for a fall of 1 million barrels. Also, distillate supplies increased 807,000 barrels, while analysts were looking for a climb of 800,000 barrels in distillates.
The API data came ahead the Energy Information Administration’s report due, often seen as more definitive, at 10:30 a.m. U.S. Eastern time.
Meanwhile, Barclays said Tuesday that implied oil demand from China moderated 4%, to 9.37 million barrels a day in August from 9.77 million barrels a day in July as a seasonal correction and maintenance kept demand muted.
However, improving exports and modest investment growth should support demand in coming months, Barclays analyst Sijin Cheng said in a research report.
“Already, headline data have improved: Industrial production in August beat the forecast and grew 10.4%” on a year-over-year basis, she wrote.
Also, after a few volatile months “due to a government crackdown on false trade receipts, exports have shown signs of recovery, as growth becomes more sure-footed in Europe, the U.S. and Japan.”
China is the world’s second-largest oil consumer.
In other moves in the energy complex Wednesday, October gasoline was unchanged at $2.73 a gallon, and October heating oil held at $3.07 a gallon.
October natural gas rose 1 cent, or 0.2%, to $3.59 per million British thermal units.
Source : Marketwatch