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RTRS:UPDATE 4-Oil slips to $109 as stockpiles rise
 
* Brent/U.S. crude spread widens to $12 on U.S. stock build

* U.S. crude falls to lowest since July 1

* API reports rise in U.S. crude stocks, China's up in Sept

* Coming up: EIA oil inventory report, 1430 GMT

By Alex Lawler

LONDON, Oct 23 (Reuters) - Brent crude fell towards $109 a barrel on Wednesday, pressured by rising inventories in China and expectations of a further buildup in the United States, the world's top consumer.

Maintenance at U.S. refineries and pipeline outages have led to an increase in domestic stocks, stretching Brent's premium to the U.S. benchmark also known as WTI to $12 a barrel, its widest since April.

Brent crude fell 57 cents to $109.40 a barrel by 1050 GMT, after hitting a session high of $110.06. U.S. crude fell $1.52 to $96.78 and earlier reached $97.10, its lowest since July 1.

"The weakness in the Brent/WTI spread reflects refinery maintenance and growing crude stocks in the U.S.," said Christopher Bellew, an oil broker at Jefferies Bache."

"Other bearish factors are the warm autumn in the northern hemisphere and Libyan oil coming back onto the market."

A series of reports showing rising crude stocks has pressured prices. On Monday, the U.S. government said they rose by 4 million barrels in the week to Oct. 11 and increased at the Cushing storage hub for the first time since the end of June.

Brent could break below $109, Bellew said, and other analysts saw a weakening chart pattern for U.S. crude. Its 200-day moving average at $98.62 is now a resistance level after prices fell below that mark.

"The technical picture in WTI is turning more negative as WTI broke the support of the 200-day moving average and it has its five-day moving average trending below the nine-day," said Olivier Jakob, consultant at Petromatrix.

Analysts expect the U.S. Energy Information Administration - returning to its normal schedule after the government shutdown - to report a further, 2.9-million-barrel increase in crude stocks for the latest week later on Wednesday.

Ahead of the EIA report at 1430 GMT, oil industry group the American Petroleum Institute said on Tuesday U.S. crude stocks rose further last week by 3 million barrels.

Stockpiles also built in China, the second-largest oil consumer, in September, official news agency Xinhua said on Wednesday, as crude imports jumped to a record high.

Rising output of shale oil added to the picture of an amply supplied U.S. market. The Eagle Ford formation in Texas has beaten North Dakota's Bakken to the milestone of 1 million barrels per day, the EIA said.

Tenuous relations between the United States and Saudi Arabia, the top oil exporter, limited the price decline for Brent. While Libya's oil output has risen, more than half has yet to return to the market due to strikes and protests.
Source