Brent dips towards $103

North Sea, Brent crude oil13 June 2013, News Wires – Brent futures slipped towards $103 a barrel on Thursday as a jump in gasoline stocks in the US with the summer driving season already underway stoked worries about demand, but a weak dollar helped stem the slide.
The US dollar wallowed at a near four-month low against a basket of major currencies as investors cut bullish positions amid uncertainty over whether the Federal Reserve will pare back its stimulus programme. That has helped cushion oil even though the market is fundamentally weak.

Brent crude slipped 21 cents to $103.28 a barrel early on Thursday, after settling 53 cents higher. US oil fell 34 cents to $95.54, after ending 50 cents higher.

“The dollar is providing support to oil,” said Ken Hasegawa, a commodity sales manager at Newedge Japan. “Fundamentally, prices should go down because demand in weak. China and Europe are not doing good, while oil supplies are ample.”

Hasegawa expects Brent to trade between $100 and $105 a barrel over the next few days, and US oil between $92 and $97.

Gasoline stocks on the US East Coast rose to their highest level since February 2012 last week. Inventories on the heavily populated East Coast jumped 2.9 million barrels to 63.8 million barrels, offsetting a slight drawdown elsewhere in the country, data from the US Energy Information Administration (EIA) showed.

The EIA data also showed a build in crude oil inventories, of 2.5 million barrels compared with a Reuters forecast of a 700,000 barrel draw.

The EIA data further adds to a weak global demand outlook, already flagged by key reports earlier this week.

The International Energy Agency said modest economic growth was limiting oil demand worldwide, and that some developed economies would see absolute declines in oil consumption in 2013.

In China weaker economic growth and lower than previously forecast consumption data support the view that demand is weakening, it said.

Both Opec and the EIA cut their global oil demand growth forecasts on Tuesday.

Brent may edge up to $104.26 per barrel, as indicated by its wave pattern and a Fibonacci retracement analysis, while US oil may climb up to $97.04, according to Reuters technical analyst Wang Tao.

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