Brent slips below $105

Brent oil prices07 November 2013, News Wires – Brent crude slipped below $105 per barrel on Thursday to its lowest since early July as investors were reluctant to lock in fresh positions ahead of key announcements due later in the day from Europe and the US.

Investors are waiting for the outcome of the European Central Bank’s policy meeting and the US third-quarter gross domestic product numbers to gauge the developed nations’ oil demand outlook, Reuters said.

US crude, however, drew strength from a steeper-than-expected drop in gasoline stocks in the world’s top oil consumer.

Brent, which fell to a low of $104.80 per barrel, was down 15 cents at $105.09 by early Thursday morning. US oil rose 18 cents to $94.98 per barrel, after settling up $1.43 on Wednesday.

“The US benchmark is drawing support from the steep fall in oil product stockpiles we saw in the data overnight, suggesting a pickup in demand,” Reuters quoted OptionsXpress market analyst Ben Le Brun as saying in Sydney.

“Overall, we will see oil and other markets trade in a tight range today as everybody is waiting for ECB’s interest rate decision and US GDP numbers.”

US gasoline stocks fell 3.8 million barrels, much larger than the 300,000-barrel draw analysts had expected, according to data from the US Energy Information Administration. Gasoline demand last week was also at its highest level for this time of the year since 2010.

US distillates stocks fell 4.9 million barrels last week, against forecasts for a 1.3-million-barrel draw, to 118 million barrels, the data showed.

The steep drawdowns in oil product stockpiles overshadowed a rise in crude inventories to 385 million barrels in the week ending 1 November – the largest seven-week build since May 2012.

Brent may end its current fall at or above $104.43 per barrel, as indicated by its wave pattern and a Fibonacci projection analysis, while US oil faces resistance at $95.27, according to Reuters technical analyst Wang Tao.

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