Crude Drops On Higher Stockpiles

Crude oil edged lower on Tuesday amid speculation crude stockpiles rose to the most since June in the US, the world’s biggest oil consumer, while Richard Fisher said stimulus program cannot continue forever turning the attention to the Federal Reserve.

US crude stockpiles probably rose for an eighth week by 500,000 barrels last week before the EIA report; yet the oil inventory data reports this week will be delayed a day due to the Veterans Day holiday on Monday.

The American Petroleum Institute (API) will release its report on Wednesday and the US Energy Information Administration (EIA) will publish its data on Thursday.

President of the Federal Reserve Bank of Dallas, Richard Fisher, said the Federal Reserve`s monetary stimulus program cannot continue forever, adding to expectations the monthly bond purchases will be cut sooner rather than later, which could lower demand on oil.

- WTI crude oil futures for December is trading around $ 94.92 a barrel after falling $0.22

- Brent futures for December settlement is trading around $ 106.17 a barrel after falling $0.23

Believes that the Federal Reserve might scale back its stimulus following these comments and the strong US employment report pushed the dollar higher against a basket of currencies, weighing on the dollar-denominated commodities such as oil more.

Global markets are also turning their focus on China as investors await the conclusion of the Third Plenum of China's Communist Party. The country’s leaders are due to unveil a 10-year reform agenda later in the day which could affect the outlook for oil demand.

Investors are also eyeing the next round of talks on Iran's nuclear program following the unsuccessful talks between Iran and world powers during the weekend. Talks will resume on November 20. Reaching a deal would push oil prices lower.

- Natural gas is trading at $ 3.569 per cubic feet after falling 0.14%

- Gasoline is trading at $ 2.5985 per cubic feet after rising 0.08%

- Heating oil (diesel) is trading at $ 2.8838 a gallon after falling 0.26%