Crude-oil futures were slightly lower in afternoon trade Tuesday in Asia, after spending much of the day in positive territory on hopes that the U.S. Federal Reserve will signal its willingness for more stimulus to drive economic growth.
On the New York Mercantile Exchange, light, sweet crude futures for delivery in August traded at $88.35 a barrel at 0715 GMT, down $0.08 in the Globex electronic session. September Brent crude on London's ICE Futures exchange fell $0.15 to $103.22 a barrel.
Federal Reserve Chairman Ben Bernanke is scheduled to begin two days of semi-annual congressional testimony later in the day.
"One of the elements behind our near-term bullish view is some expected stimulus measures globally," said Jim Ritterbusch at Ritterbusch and Associates in a note. "We will look for comments from the Fed chairman to offer some clues in this regard."
Previous rounds of quantitative easing by the U.S. Federal Reserve have weakened the dollar, making crude cheaper to buyers holding other currencies and driving oil prices higher.
Oil prices have been hammered in the last few months by a lot of bearish economic data from major economies, and analysts say prices could decline further without support from fresh economic stimulus.
Besides the U.S., oil markets are also hoping that Beijing will take steps to spur economic momentum. Recent data suggest the slowdown in China's economic growth is hurting oil demand with its refineries reducing processing rates in June to their lowest levels in a year. Production of diesel in June fell 2% on year to 13.34 million metric tons, government data showed Tuesday.
Nymex reformulated gasoline blendstock for August--the benchmark gasoline contract--fell 16 points to $2.8531 a gallon, while August heating oil traded at $2.8262, 15 points lower.
ICE gasoil for August changed hands at $892.25 a metric ton, up $2.75 from Monday's settlement.
Write to Gurdeep Singh at gurdeep.singh@dowjones.com
