Crude oil slipped below the $100-mark on Thursday amid speculation that the rally seen this week when prices jumped above the $101-mark was excessive. Also pushing oil prices lower were worries of a drop in consumption as refineries entered the maintenance season.
“The cold weather in the United States, Asia and even Europe has boosted momentum recently, but I don`t think prices can hold up once temperatures rise”, said Tony Hunan from Mitsubishi Corp in Tokyo.
“This may be the beginning of a downward correction like the one we saw at the end of December and beginning of January”, Tony added.
Losses however may be rather limited as data showed record crude imports by China in January, while the US Energy Information Administration (EIA) and OPEC raised their expectations for global oil demand growth this year.
Moreover, the EIA data showed yesterday that crude stockpiles dropped by 2.67 million barrels last week, distillates stockpiles fell by 731,000 barrels, while gasoline inventories slid by 1.85 million barrels last week.
More support may be found from the potential for further supply interruptions from Libya, as protesters closed gas and oil pipelines from the Wafa oilfield and are threatening to block another line from El Sharara field.
