WSJ:OIL FUTURES: Crude Falls On Technical Correction; Economy In Focus
SINGAPORE (Dow Jones)--Crude-oil futures were lower in Asia Tuesday due to a technical correction after the front-month contract settled 2.9% higher on the New York Mercantile Exchange Monday--the highest since Aug. 3--on the back of strong equities and a weak dollar.
On Nymex, light, sweet crude futures for delivery in September traded at $87.15 a barrel at 0626 GMT, down $0.73 in the Globex electronic session. September Brent crude on London's ICE Futures exchange fell $0.72 to $109.19 a barrel.
"This is a technical correction as Monday's recovery in crude prices was too strong," Yusuke Seta, a Tokyo-based trader with Newedge Japan, said.
Meanwhile, lingering concerns over the state of the global economy will continue to dictate market direction, Tokyo-based fund manager Tomohisa Okada of Astmax Co. said.
Nymex crude futures would be a good buy if they dropped below $80 a barrel, Okada said, tipping the front-month contract to trade in a $80-$90 range this week as fundamentals haven't changed much.
U.S. weekly oil inventory data to be released by the Department of Energy Wednesday will likely show a decline in last week's crude inventories.
Crude stockpiles are expected to fall by 400,000 barrels, analysts polled by Dow Jones Newswires said. Gasoline stocks will likely drop by 1.3 million barrels, while distillate stocks--consisting of diesel fuel and heating oil--may rise by 700,000 barrels.
U.S. oil inventory data will likely have limited impact on oil markets at they may be overshadowed by persistent concerns over the global economy's prospects, Okada said.
Nymex reformulated gasoline blendstock for September--the benchmark gasoline contract--fell 188 points to $2.8557 a gallon, while September heating oil traded at $2.9292, 149 points lower.
ICE gasoil for September changed hands at $921.50 a metric ton, down $1.25 from Monday's settlement.
