RTTN: OIL FUTURES: Crude Little Changed Ahead of U.S. Oil Data
--Market seeks short-term guidance from U.S. oil inventory data
--Iran worries keep prices from steep fall
--IMF sees soft landing for China, but warns of risks
By David Bird
NEW YORK--Crude oil futures prices were little changed early Wednesday, awaiting direction from weekly U.S. oil inventory and demand data due out at 10:30 a.m. EDT.
An indication of near-term fundamentals in the world's biggest oil consumer will come as the concerns about weakness in demand from ailing economies in Europe and China have kept prices in check. The International Monetary Fund said China's economy is heading for a soft landing, but warns of significant downside risks. China is the engine of growth for world oil demand, and is expected to account for about 40% of global oil-demand growth in 2012, according to the International Energy Agency.
Worries about a potential contagion effect of economic problems stemming from fiscal problems in Greece and Spain have gripped the global markets and cut oil demand. At the same time, worries about how international sanctions on Iran will impact global supplies have prevented prices from dropping dramatically.
"As far as Iran is concerned, lack of significant progress in negotiations and statements out of the country that they are pushing ahead with uranium enrichment programs keep odds skewed in favor of risk premium expansion, rather than contraction" in oil prices, said Jim Ritterbusch, president of Ritterbusch & Associates.
Light, sweet crude oil for September delivery on the New York Mercantile Exchange was 15 cents higher, at $88.65 a barrel. September North Sea Brent crude oil futures on the Intercontinental Exchange was 12 cents higher, at $103.51 a barrel.
Widely watched inventory data from the Energy Information Administration is expected to show U.S. crude oil stocks fell by 800,000 barrels in the week ended Friday, while refiners trimmed operations by 0.2 percentage points. Gasoline stocks are expected to show a 500,000-barrel drop, while distillate stocks (diesel/heating oil) are expected to rise by 1.1 million barrels.
Late Tuesday, the American Petroleum Institute, a trade group, reported in its weekly data that inventories across the board rose by more than expected. The API said crude oil stocks rose by 1.348 million barrels, on a 579,000 barrels a day rise in imports from a week earlier. Refineries boosted operations by 1.9 percentage point, the trade group said. The API said gasoline stocks rose 2.348 million barrels, while distillates stocks rose 2.641 million barrels.
August-delivery heating oil was unchanged at $2.8244 a gallon, while August reformulated gasoline blendstock futures were down 4.29 cents, at $2.7819 a gallon.
Write to David Bird at david.bird@dowjones.com
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