13 September 2013, News Wires – Brent crude futures nudged higher on Friday towards $113 per barrel on supply concerns, but the contract was still set for its biggest weekly drop in nearly three months as fears of a US-led military attack on Syria receded.
Besides developments relating to the Middle East nation, investors are awaiting a slew of US data slated for release later in the day for more signals on whether the Federal Reserve will begin unwinding its long-standing monetary stimulus this month, Reuters reported.
The US and Russia started talks on Thursday about Moscow’s plan for Syria to surrender its chemical weapons, but the US Secretary of State underscored the point that military force may still be needed if diplomacy fails.
Benchmark Brent crude for October, which expires on Friday, was up 11 cents at $112.74 per barrel by Friday morning, after gaining $1.13 on Thursday. US crude was 3 cents lower at $108.57 per barrel.
Brent is now up for three straight sessions but the gains don’t seem enough to cover two days of heavy losses in the week that wiped nearly $5 off the European benchmark, and put it on track for a nearly 3% weekly drop, its steepest since the week that ended 21 June.
“Libyan crude supply problems have lifted Brent of late, but until the situation in Syria is clearer and the outcome of next week’s Fed meeting is known, it is hard to take a position,” Reuters quoted Kaname Gokon, deputy general manager at Tokyo-based broker Okato Shoji Co.
Libya’s state National Oil Corp has declared force majeure on three ports, a company document showed on Thursday, following several weeks of shutdown.
In addition, a processing platform in Norway’s Ekofisk crude stream will be partially shut down in the next week for repairs, its operator said on Thursday, which may further delay shipments of the oil that helps set the Brent benchmark.
Investors are now awaiting a heap of economic data due out of Washington later in the day, including producer inflation and retail sales figures, which may shed more light on the Federal Reserve’s stimulus strategy going forward.
The US central bank is expected to reduce its $85 billion per month bond-buying programme at its two-day policy meeting that ends on 11 September. But recent weaker-than-expected data intensifies uncertainty about the extent of reduction.
Asian shares slipped on Friday and the dollar held to overnight losses against the yen as investors fretted not whether, but by how much, the Fed will cut its monthly stimulus at next week’s monetary meeting.
