IV:Crude oil futures edge lower in choppy trade; Egypt, Fed in focus
Investing.com - Crude oil futures edged lower in choppy trade on Monday, as traders remained focused on the turmoil in Egypt, while uncertainty over whether the Federal Reserve will soon begin tapering its bong-buying program continued to weigh.
The Fed’s stimulus program is viewed by many investors as a key driver in boosting the price of commodities as it tends to depress the value of the dollar.
On the New York Mercantile Exchange, light sweet crude futures for delivery in October traded at USD107.03 a barrel during European morning trade, down 0.25%.
Nymex oil futures traded in a range between USD106.79 a barrel, the daily low and a session high of USD107.55 a barrel.
The September contract settled up 0.1% at USD107.29 a barrel on Friday.
Oil futures were likely to find support at USD105.01 a barrel, the low from August 12 and resistance at USD108.74 a barrel, the high from August 2.
Nymex oil futures rose 1.1% last week as ongoing violence in Egypt fuelled concerns over a disruption to supplies from the Middle East.
Countries in the Middle East and North Africa were responsible for 36% of global oil production and held 52% of proved reserves in 2012.
Investors remained cautious ahead of the minutes of the Fed's July meeting, due out on Wednesday, for further indications as to when the central bank may start to unwind its USD85 billion-a-month asset purchase program.
U.S. data on initial jobless claims and the housing sector later in the week will also be closely watched.
Market players have closely been looking out for U.S. data reports recently to gauge if they will strengthen or weaken the case for the Fed to reduce its bond purchases.
Any improvement in the U.S. economy was likely to reinforce the view that the central bank will begin to taper its bond purchase program in the coming months.
Elsewhere, on the ICE Futures Exchange, Brent oil futures for October delivery dipped 0.1% to trade at USD110.39 a barrel, with the spread between the Brent and crude contracts standing at USD3.36 a barrel.
Brent prices hit USD110.70 a barrel on Friday, the highest level since April 2.
