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NYMEX-Crude drops below $108 as supply worries ease
March 20, 2012 / 12:51 AM / 6 years ago

NYMEX-Crude drops below $108 as supply worries ease

SEOUL, March 20 (Reuters) - U.S. crude oil futures dipped on Tuesday, after gaining in the previous session, as global supply worries eased after Saudi Arabia increased oil shipments in January and Libya announced plans to lift oil exports to pre-war levels.

FUNDAMENTALS

* On the New York Mercantile Exchange, crude for April delivery, which expires on Tuesday, lost 29 cents a barrel at $107.80 as of 0029 GMT after settling up $1.03 at $108.09.

* In London, ICE Brent crude for May delivery extended losses by 36 cents a barrel at $125.35 after settling down 10 cents at $125.71 a barrel.

* China will raise retail gasoline and diesel prices by between 6 and 7 percent from Tuesday, marking the biggest increase in 33 months, a move that will help refiners reduce heavy losses but is unlikely to hit demand in a big way.

* U.S. Treasury Secretary Timothy Geithner said Europe was only at the initial stages of a long and difficult path toward fiscal sustainability and warned heavily indebted countries not to resort to draconian measures to boost their economies, according to congressional testimony released on Monday.

* U.S. homebuilder sentiment was unchanged in March to hold at the highest level since June 2007 while sentiment in February was revised lower, the National Association of Home Builders said on Monday.

* The U.S. Federal Reserve has not yet decided whether to embark on a third round of quantitative easing, or QE3, though it remains an option, said New York Fed President William Dudley, who painted a mixed picture of the U.S. economy.

* U.S. commercial crude stockpiles are forecast to have climbed last week on higher imports and lower refinery activity, in line with seasonal patterns, a preliminary Reuters poll of analysts showed on Monday.

* Bank of America Merrill Lynch raised 2012 price forecasts for Brent crude by $8 to $118 a barrel and for U.S. oil by $3 to $106 a barrel, citing better-than-expected global economic conditions and tighter-than-expected supplies.

* Societe Generale raised its price forecasts for Brent crude oil and U.S. West Texas Intermediate crude oil for 2012 and 2013 citing supply side issues like tight crude stocks, low OPEC spare capacity and strong non-OPEC supply disruption.

* In Syria, rebels fought gun battles with government forces in Damascus, in the most violent clashes the capital has seen since the start of the year-old revolt against President Bashar al-Assad.

In a fresh effort to form a united international front on the mounting crisis, France circulated a Western-drafted statement for the U.N. Security Council deploring the turmoil and backing peace efforts by U.N.-Arab League envoy Kofi Annan. Britain’s U.N. envoy said he hoped the statement would be adopted on Tuesday.

MARKETS NEWS

* The S&P 500 extended its rally on Monday to climb within 10 percent of its historic closing high, after Apple said it would pay a $10 billion annual dividend and buy back stock.

DATA/EVENTS

* The following data is expected on Tuesday (GMT): 1145 U.S. ICSC chain stores yy Weekly 1230 U.S. Build permits: change mm Dec 1230 U.S. House starts mm: change Dec 1230 U.S. Housing starts number mm Feb 2030 U.S. API weekly crude stocks Mar 16 2030 U.S. API weekly dist. stocks Mar 16 2030 U.S. API weekly gasoline stk Mar 16 (Reporting by Cho Mee-young; Editing by Himani Sarkar)

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