A worker walks past oil pipes at a refinery
in Wuhan, Hubei province March 23, 2012.
NEW YORK (Reuters) - Oil
inched up on Tuesday, lifted by expectations of
another crude stockpile drawdown in the United
States but price gains were limited amid the
reopening of Libya's largest oil field.
Prices, however, pared
gains in post settlement trade and Brent crude
turned negative as the market was disappointed
by industry data from the American Petroleum
Institute showing a crude stockpile decline
largely in line with expectations and a surprise
build in gasoline inventories. [API/S]
U.S. crude inventories were
expected to have fallen 3.5 million barrels last
week, the eighth straight weekly drawdown, and
gasoline to have drawn down by over 600,000
barrels, a Reuters poll showed, ahead of weekly
data.
Official government
inventory data for last week will be released on
Wednesday at 10:30 a.m. EDT (1430 GMT). [EIA/S]
Brent crude LCOc1 settled
21 cents, or 0.4 percent, higher at $51.87 a
barrel.
Book-squaring ahead of the U.S. crude
September contract's expiry on Tuesday added to
price gains, traders and brokers said.
U.S. crude futures for
September delivery CLc1 CLU7 closed 27 cents, or
0.6 percent, higher at $47.64 while the more
active October contract CLc2 ended the session
up 30 cents at $47.83.
U.S. gasoline futures RBc1
also led the complex higher for most of the
session and settled up 0.4 percent at $1.5908 a
gallon as forecasts for heavy rain associated
with the remnants of former tropical storm
Harvey threatened to cause refinery flooding,
traders said.
A tropical depression is
expected to form over the southwestern Gulf of
Mexico on Wednesday or Thursday.
"Traders of crude oil and
gasoline will also have particular interest in
the remnants of Tropical Storm Harvey expected
to strengthen to Category 1 hurricane status as
it crosses the Gulf of Mexico toward a possible
Friday landfall on the Texas Coast," Tim Evans,
Citi Futures' energy futures specialist, said in
a note.
"While not a major storm,
this will at least serve as a drill for refiners
along the coast, in our view."
Libya's Sharara oil field
was gradually reopening after its latest
shutdown, field workers said. Earlier in the day
an oil official said it was shut again hours
after reopening on Tuesday following a three-day
pipeline blockade.
Sharara, which has been
pumping up to 280,000 barrels per day (bpd) in
recent weeks, has been affected by repeated
shutdowns because of protests by armed groups
and oil workers.
The Organization of the
Petroleum Exporting Countries and non-OPEC
producers including Russia have pledged to hold
back about 1.8 million barrels per day (bpd) of
output between January this year and March 2018
in order to tighten supplies and prop up prices.
Meanwhile, U.S. crude
production has broken through 9.5 million bpd,
its highest since July 2015. C-OUT-T-EIA
Some analysts say U.S. oil
output growth will slow as energy firms cut the
number of rigs drilling for oil. RIG-OL-USA-BHI
Still U.S. commercial crude
inventories have fallen by almost 13 percent
from their March peaks, to 466.5 million barrels
as refineries have continually processed record
amounts of oil. C-STK-T-EIA
"Another decline in U.S.
crude stocks may push prices somewhat higher
again, but the upside may be limited -
especially if U.S. crude production ticks higher
again," said Hans van Cleef, energy economist at
ABN AMRO.
(For a graphic on Brent oil, click
tmsnrt.rs/2wCto7h)
(For a graphic, click
tmsnrt.rs/2v3MhAs)
Additional reporting by Christopher Johnson
in London, Henning Gloystein and Aaron
Sheldrick in Singapore; Editing by
Marguerita Choy and Louise Heavens
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http://www.reuters.com/article/us-global-oil-idUSKCN1B303A