MW: OIL FUTURES: Crude Hovers Around $77 As Euro Falls; EIA Awaited
By Mari Iwata
TOKYO (MarketWatch) -- Crude oil was fluctuating around $77 a barrel Wednesday in Asia, tracking intraday moves in the euro ahead of key U.S. oil inventory data due later in the global day.
Asian shares were broadly higher following overnight gains in U.S. stocks, but crude traders were waiting for the inventory numbers before joining in the bullish mood created by encouraging earnings reports from key U.S. companies, analysts said.
On the New York Mercantile Exchange, light, sweet crude futures for delivery in August traded at $76.91 a barrel at 0554 GMT, down $0.24 in the Globex electronic session. August Brent crude on London's ICE Futures exchange fell $0.36 to $76.29 a barrel.
Crude moved a tad higher in early Asian trade, extending its 2.9% overnight rise in New York, but prices edged into negative territory as the euro weakened, before paring losses as the common currency strengthened.
Trade remained relatively sluggish as the market awaited oil stockpiles data from the Energy Information Administration due at 10:30 a.m. EDT. Crude oil inventories are expected to fall by 1.2 million barrels, while gasoline inventories are expected to be flat, according to the mean of 16 analysts' forecasts in a Dow Jones Newswires poll.
Data from the American Petroleum Institute Tuesday during U.S. hours showed higher crude and gasoline stockpiles, but the result has "not significantly affected sentiment," as API data aren't always in line with the more-widely-viewed EIA, Mitsubishi Corporation Futures analyst Tomokazu Amano said.
Hiroyuki Kikukawa, an analyst with broker Nihon Unicom, added that if the data show a fall in inventories close to market forecasts, "we may see a selloff in crude, as current (high) prices might have already factored in" the draw in stocks.
August Nymex crude rose more than $2 overnight, and is close to the higher end of its recent price range of $70 a barrel to $80 a barrel. To breach the range and test $80/barrel "seems difficult unless there are positive surprises from economic indicators," Kikukawa noted.
Nymex reformulated gasoline blendstock for August--the benchmark gasoline contract--fell 81 points to $2.0740 a gallon, while August heating oil traded at $2.0374, 100 points lower.
ICE gasoil for August changed hands at $650.50 a metric ton, down $2.75 from Tuesday's settlement.
