Wednesday, August 31, 2011

NYMEX-Oil falls on large crude stocks build

SINGAPORE: U.S. crude futures fell on Wednesday, Aug 31, heading for a decline of 7.7 percent in their biggest monthly loss since May, on fears that another recession in the United States and a debt crisis in the euro zone could cut fuel demand.

An industry report showed a higher than expected rise in U.S. crude oil inventories last week, causing futures to fall from a three-week high settlement on Tuesday.

Investors also eyed storms brewing in the Atlantic and the northwestern Caribbean Sea for possible supply disruptions.


* On the New York Mercantile Exchange, crude for October delivery snapped four days of gains and fell 35 cents to $88.55 a barrel by 0028 GMT after hitting an intraday low of $88.51.

* In London, ICE Brent crude for October delivery rose 1 cent to $114.03 a barrel.

* U.S. crude's discount against Brent crude was at $25.45, slightly wider than Tuesday's close.

* U.S. crude oil inventories surged last week as imports rose and refinery utilization dropped, while gasoline saw a big draw, data from the American Petroleum Institute showed.

Crude stockpiles rose 5.1 million barrels for the week to Aug. 26, well over analyst expectations for a 400,000 barrel gain.

* Investors were eyeing the development of Tropical Storm Katia in the Atlantic which could become a hurricane by late Wednesday or early Thursday, according to the National Hurricane Center.

* A tropical wave over the northwestern Caribbean Sea has a 10 percent chance of becoming a cyclone in the next 48 hours, and could move into the western Gulf of Mexico, home to a large concentration of oil and natural gas facilities.

* Libya's oil production can restart within weeks and reach full pre-war output within 15 months, the newly-appointed chairman of the country's National Oil Corporation (NOC) said.

* OPEC's oil output is expected to rise in August to its highest in almost three years due to an increase in Nigerian exports and smaller rises from Saudi Arabia and other Gulf producers, a Reuters survey found

* The CME Group said it declared force majeure on the few remaining August deliveries of its New York Mercantile Exchange August 2011 heating oil futures contract Tuesday due to damage at a delivery facility in the New York Harbor caused by Hurricane Irene.

* Exxon Mobil Corp and Rosneft signed an agreement to extract oil and gas from the Russian Arctic, in the most significant U.S.-Russian corporate deal since U.S. President Barack Obama began a push to improve ties.


* Renewed concerns about the euro zone sovereign debt crisis weighed on the euro in Asia on Wednesday, while the dollar also struggled after minutes of the U.S. Federal Reserve's Aug. 9 meeting bolstered expectations for more stimulus.

* The Nikkei edged lower on Wednesday with investor sentiment hurt by news that U.S. consumer confidence fell to its worst level in two years and as profit-taking is likely after the index rose for four straight days.

* Gold, oil and bonds surged on Tuesday while Wall Street rebounded in choppy trade after the latest Federal Reserve minutes boosted expectations policymakers will act again to try to stimulate the economy.

* Consumer confidence in the United States hit a two-year low in August and prices of single-family homes dipped in June from May as the housing market continued to crawl along at depressed levels, data showed on Tuesday.

* The U.S. Federal Reserve considered a range of actions to help a struggling economy at its August meeting, including the unprecedented step of tying the interest rate policy outlook to a specific unemployment level.


* The following data is expected on Wednesday:

* U.S. Energy Information Administration oil inventory data due at 10:30 a.m. EDT (1130 GMT) Wednesday.

* NYMEX September RBOB gasoline and heating oil futures contracts expire Wednesday. - Reuters

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