Oil slips towards $83 on high inventory
Wednesday, 28 April 2010
LONDON, April 27 (Reuters): Oil slipped below $84 Tuesday, pulled lower by expectations of a rise in US stockpiles and nagging concerns Greece's economic trauma could have knock-on effects on the wider economy and demand for fuel.
Oil and commodities traders are also awaiting a decision later during the day from top US futures regulator, the Commodity Futures Trading Commission, on whether two-dozen energy contracts needed more oversight.
US crude for June delivery fell 94 cents to $83.26 a barrel by 1052 GMT, while ICE June Brent crude dipped by 77 cents to $86.96.
"The market is a little worried about the Greece situation and probable builds in inventories again in the US statistics," said Tony Nunan, a risk manager with Mitsubishi Corp.
Inventories of crude oil in the United States, the world's top energy consumer, probably rose for the second consecutive week, Reuters' survey of analysts showed ahead of two sets of oil data due out later on Tuesday and Wednesday.
Industry group American Petroleum Institute will release its report for the week to April 23 at 2030 GMT on Tuesday. Official Energy Information Administration data will follow at 1430 GMT on Wednesday.
Analysts in the survey expected a 400,000 barrel increase in US crude oil stocks. Oil product inventories, such as gasoline, were also forecast for increases.
The oil futures market structure, rather than outright prices, has reflected high levels of inventories especially at Cushing in Oklahoma, the United States, the delivery point of US crude.
The heavy inventories have made the prompt US crude futures cheaper than longer dated contracts, a structure called contango. The contango has steepened over about a past month.
The euro slipped and European shares dipped on renewed worries over Greece's debt after Germany demanded painful new austerity measures from Athens in return for financial aid.
Traders may take to the sidelines during the early part of the US business day, said Olivier Jakob with Petromatrix, as a CFTC hearing will start 1330 GMT.
The CFTC will look at 24 contracts owned by the IntercontinentalExchange Inc (ICE.N), the Natural Gas Exchange Inc and the Chicago Climate Exchange Inc (CLIE.L).
The regulator last year identified more than 40 contracts listed on electronic markets that might merit closer supervision, mostly for electric power and natural gas.
Still, prices of oil have risen by about 65 per cent from a year earlier due to growth in demand from emerging markets such as China and brightening outlooks for US economy.
Oil and commodities traders are also awaiting a decision later during the day from top US futures regulator, the Commodity Futures Trading Commission, on whether two-dozen energy contracts needed more oversight.
US crude for June delivery fell 94 cents to $83.26 a barrel by 1052 GMT, while ICE June Brent crude dipped by 77 cents to $86.96.
"The market is a little worried about the Greece situation and probable builds in inventories again in the US statistics," said Tony Nunan, a risk manager with Mitsubishi Corp.
Inventories of crude oil in the United States, the world's top energy consumer, probably rose for the second consecutive week, Reuters' survey of analysts showed ahead of two sets of oil data due out later on Tuesday and Wednesday.
Industry group American Petroleum Institute will release its report for the week to April 23 at 2030 GMT on Tuesday. Official Energy Information Administration data will follow at 1430 GMT on Wednesday.
Analysts in the survey expected a 400,000 barrel increase in US crude oil stocks. Oil product inventories, such as gasoline, were also forecast for increases.
The oil futures market structure, rather than outright prices, has reflected high levels of inventories especially at Cushing in Oklahoma, the United States, the delivery point of US crude.
The heavy inventories have made the prompt US crude futures cheaper than longer dated contracts, a structure called contango. The contango has steepened over about a past month.
The euro slipped and European shares dipped on renewed worries over Greece's debt after Germany demanded painful new austerity measures from Athens in return for financial aid.
Traders may take to the sidelines during the early part of the US business day, said Olivier Jakob with Petromatrix, as a CFTC hearing will start 1330 GMT.
The CFTC will look at 24 contracts owned by the IntercontinentalExchange Inc (ICE.N), the Natural Gas Exchange Inc and the Chicago Climate Exchange Inc (CLIE.L).
The regulator last year identified more than 40 contracts listed on electronic markets that might merit closer supervision, mostly for electric power and natural gas.
Still, prices of oil have risen by about 65 per cent from a year earlier due to growth in demand from emerging markets such as China and brightening outlooks for US economy.